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S&P Global Inc. (SPGI), headquartered in New York, provides clients with financial information services. Valued at $156.1 billion by market cap, the company provides credit ratings, benchmarks, analytics, and workflow solutions in the global capital, commodity, and automotive markets.
Shares of this leading financial services agency have outperformed the broader market considerably over the past year. SPGI has gained 30% over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 27%. However, in 2024, SPGI’s stock rose 13.2%, compared to SPX’s 16.8% rise on a YTD basis.
Narrowing the focus, SPGI has lagged behind the iShares U.S. Broker-Dealers & Securities Exchanges ETF (IAI). The exchange-traded fund has gained about 35.8% over the past year. Moreover, the ETF’s 15.2% gains on a YTD basis outshine the stock’s returns over the same time frame.
SPGI’s overall performance can be attributed to the high demand for its data and analytics products, particularly in the Ratings Division, as well as the successful integration of IHS Markit. Furthermore, investor optimism regarding potential interest rate cuts and a stable economic outlook has led to increased spending on products that support informed investment decisions, benefiting companies like SPGI.
On Jul. 30, SPGI shares closed down marginally after reporting its Q2 results. Its adjusted EPS of $4.04 topped Wall Street expectations of $3.67. The company’s revenue was $3.6 billion, topping Wall Street forecasts of $3.4 billion. The company raised its full-year 2024 guidance and expects adjusted EPS to be between $14.35 and $14.60 and a revenue growth of 8% to 10%.
For the current fiscal year, ending in December, analysts expect SPGI’s EPS to grow 15.7% to $14.58 on a diluted basis. The company’s earnings surprise history is mixed. It beat the consensus estimate in three of the last four quarters while missing the forecast on another occasion.
Among the 19 analysts covering SPGI stock, the consensus is a “Strong Buy.” That’s based on 16 “Strong Buy” ratings and three “Moderate Buys.”
This configuration is more bullish than a month ago, with 15 analysts suggesting a “Strong Buy.”
On Jul. 31, Morgan Stanley (MS) analyst Toni Kaplan maintained a “Buy” rating on SPGI with a price target of $530, implying a potential upside of 6.3% from current levels.
The mean price target of $549.41 represents a 10.2% premium to SPGI’s current price levels. The Street-high price target of $575 suggests an upside potential of 15.3%.
On the date of publication, Neha Panjwani did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
