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Verisk Analytics (VRSK)
NASDAQ:VRSK
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Verisk Analytics
(NASDAQ:VRSK)
64Neutral
Positive Factors
Cloud Transition
Verisk has completed a significant cloud transition, which positions it ahead of the P&C insurance industry that has lagged behind many others in cloud transition.
Earnings Performance
Adjusted EPS beat expectations, mostly margin-driven.
Subscription Growth
Strong subscription growth reflected broad-based strength in renewals and price realization across the portfolio, aided by the conversion of transactional contracts to a subscription-based model.
Negative Factors
Earnings Guidance
Shares traded lower due to a lower-than-expected EPS guide and relatively heightened investor expectations.
Interest Expense
A higher-than-expected interest expense outlook appears to be the primary driver of the lower-than-expected EPS outlook.
Transactional Revenue
Transactional revenue has remained weak, leading to a cautious outlook for the upcoming quarter.
Verisk Analytics (VRSK) vs. S&P 500 (SPY)
Market Cap
$42.80B
Dividend Yield0.53%
Average Volume (3M)937.68K
Price to Earnings (P/E)45.5
Beta (1Y)0.52
Revenue Growth7.47%
EPS Growth59.46%
CountryUS
Employees7,800
SectorIndustrials
Sector Strength68
IndustryConsulting Services
Share Statistics
EPS (TTM)6.71
Shares Outstanding140,276,170
10 Day Avg. Volume893,958
30 Day Avg. Volume937,677
Financial Highlights & Ratios
PEG Ratio0.76
Price to Book (P/B)N/A
Price to Sales (P/S)13.88
Price to Cash Flow (P/CF)39.20
P/FCF Ratio31.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$306.40Price Target Upside7.51% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering11
Verisk Analytics Business Overview & Revenue Model
Company DescriptionVerisk Analytics, Inc. is a leading data analytics and risk assessment company that provides predictive analytics and decision-support solutions to clients in various sectors, including insurance, energy, and financial services. The company's core offerings include data analytics, risk assessment, and management services designed to help businesses make informed decisions by leveraging comprehensive data sets and sophisticated analytical tools.
How the Company Makes MoneyVerisk Analytics generates revenue primarily through the sale of its data analytics and risk management solutions. The company offers subscription-based services, where clients pay recurring fees for access to Verisk's data and analytical tools. Additionally, Verisk provides customized consulting services and software solutions, which contribute to its revenue streams. Key factors contributing to its earnings include long-term contracts with insurance companies for risk assessment, partnerships with energy companies for market analysis, and providing financial services firms with analytical insights. Verisk's ability to offer specialized, industry-specific solutions helps the company maintain a competitive edge and sustain its revenue growth.
Verisk Analytics Financial Statement Overview
Summary
Verisk Analytics exhibits a mixed financial position. Operational efficiency is evident through margins, but declining revenues and equity, coupled with increased leverage, point to financial strains. The absence of cash flow data in 2024 is concerning, indicating potential liquidity issues.Income Statement
Verisk Analytics shows a mixed performance in its income statement. The gross profit margin remained healthy in 2024, and the EBIT margin indicates strong operational efficiency. However, a significant decline in total revenue in 2024 is concerning, which negatively affected the net profit margin. The negative revenue growth rate from 2023 to 2024 highlights a downturn, which might indicate market challenges or strategic realignment.65
Positive
Balance Sheet
The balance sheet reflects a high debt-to-equity ratio, suggesting a leveraged position. Despite the decline in stockholders' equity, the company maintains a solid equity ratio, although it has decreased over the years. The low return on equity in 2024 indicates inefficiencies in generating profits from shareholders' investments. Overall, the balance sheet reflects financial pressure, with rising liabilities and declining equity.55
Neutral
Cash Flow
The cash flow statement reveals challenges, particularly in 2024 where operating and free cash flows are absent. Historically, Verisk Analytics generated consistent free cash flows, but the lack of cash flow data for 2024 raises concerns about liquidity management and cash generation. The absence of cash flow data also limits insights into potential cash flow growth or effective capital expenditure management.45
Neutral
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 735.60M | 2.68B | 2.50B | 3.00B | 2.78B | Gross Profit |
| 505.10M | 1.80B | 1.67B | 1.94B | 1.79B | EBIT |
| 316.30M | 1.13B | 1.41B | 1.00B | 1.04B | EBITDA |
| 1.66B | 1.42B | 1.64B | 1.16B | 1.39B | Net Income Common Stockholders |
| 1.49M | 614.60M | 954.30M | 666.30M | 712.70M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 291.20M | 303.90M | 112.50M | 280.30M | 218.80M | Total Assets |
| 4.26B | 4.37B | 6.96B | 7.81B | 7.56B | Total Debt |
| 3.25B | 3.10B | 3.96B | 3.61B | 3.52B | Net Debt |
| 2.95B | 2.79B | 3.84B | 3.33B | 3.31B | Total Liabilities |
| 4.16B | 4.04B | 5.19B | 4.97B | 4.86B | Stockholders Equity |
| 100.10M | 310.00M | 1.75B | 2.82B | 2.70B |
| Cash Flow | Free Cash Flow | |||
| 920.10M | 830.70M | 784.30M | 887.30M | 821.40M | Operating Cash Flow |
| 1.14B | 1.06B | 1.06B | 1.16B | 1.07B | Investing Cash Flow |
| 0.00 | 2.75B | 301.40M | -592.00M | -595.80M | Financing Cash Flow |
| -1.03B | -3.79B | -1.33B | -498.90M | -445.20M |
Verisk Analytics Technical Analysis
Positive
284.99
Price Trends
291.89
Positive
286.68
Positive
278.05
Positive
Market Momentum
1.10
Negative
59.57
Neutral
82.22
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For VRSK, the sentiment is Positive. The current price of 284.99 is below the 20-day moving average (MA) of 292.65, below the 50-day MA of 291.89, and above the 200-day MA of 278.05, indicating a bullish trend. The MACD of 1.10 indicates Negative momentum. The RSI at 59.57 is Neutral, neither overbought nor oversold. The STOCH value of 82.22 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for VRSK.
Verisk Analytics Risk Analysis
Verisk Analytics disclosed 27 risk factors in its most recent earnings report. Verisk Analytics reported the most risks in the “Tech & Innovation” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Verisk Analytics Peers Comparison
Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $16.62B | 31.07 | 28.12% | 0.95% | 4.66% | 11.15% | |
74 Outperform | $160.30B | 41.36 | 11.44% | 0.75% | 13.68% | 49.90% | |
73 Outperform | $42.23B | 38.74 | -117.99% | 1.21% | 12.94% | -2.54% | |
70 Outperform | $12.44B | 33.89 | 25.11% | 0.57% | 11.60% | 161.17% | |
64 Neutral | $42.80B | 45.48 | 463.98% | 0.53% | 7.47% | 59.46% | |
62 Neutral | $8.08B | 13.63 | 3.82% | 3.13% | 3.58% | -14.35% | |
56 Neutral | $1.72B | ― | 493.63% | ― | -19.49% | 16.08% |
* Industrials Sector Average
Performance Comparison
VRSK
Verisk Analytics
284.99
59.93
26.63%
FDS
Factset Research
416.19
-19.93
-4.57%
SPGI
S&P Global
451.50
20.62
4.79%
MORN
Morningstar
268.76
-43.66
-13.97%
MSCI
MSCI
507.44
-35.12
-6.47%
IHS
IHS Holding
4.71
1.28
37.32%
Verisk Analytics Earnings Call Summary
Earnings Call Date: Feb 26, 2025 | % Change Since: -4.77% | Next Earnings Date: May 6, 2025
Earnings Call Sentiment Positive
Verisk's earnings call highlighted strong subscription growth, margin expansion, and record free cash flow, demonstrating a solid financial and operational performance in 2024. Despite challenges in transactional revenues and the auto segment, strategic pricing, innovation, and increased dividends reflect a positive outlook for 2025.Highlights
Strong Subscription Growth
Verisk delivered strong fourth quarter results with an 11% subscription growth, driven by strategic pricing and client engagement.
Organic Constant Currency Revenue Growth
The company achieved organic constant currency (OCC) revenue growth of 8.6% in Q4 and 7.1% for the full year 2024.
Margin Expansion
Adjusted EBITDA margins expanded by 120 basis points to 54.7% for the full year 2024.
Record Free Cash Flow
Verisk reported a record free cash flow of $920 million for 2024, an increase of 11% from the previous year.
Dividend Increase and Share Repurchase Authorization
The Board approved a 15% increase in dividends and an additional $1 billion in share repurchase authorization.
Lowlights
Transactional Revenue Decline
Transactional revenues declined by 1.1% on an OCC basis during the fourth quarter, influenced by a shift to subscription contracts.
Challenges with Auto Segment
The auto segment faced challenges with notable attrition, particularly within the insurtech customer segment.
Increased Interest Expense
Net interest expense increased due to higher rates, impacting the overall financial outlook with an expectation of $145 to $165 million in 2025.
Impact of California Wildfires
The recent California wildfires resulted in significant industry losses, affecting insurance market dynamics.
Company Guidance
In the fourth quarter of fiscal year 2024, Verisk reported strong financial performance, highlighted by 11% subscription growth and an 8.6% increase in organic constant currency (OCC) revenue, driven by sales momentum and storm-related activities. The company achieved 9.9% OCC adjusted EBITDA growth and a 120 basis-point margin expansion, resulting in a 16% earnings per share (EPS) growth. For 2025, Verisk provided guidance with an expected OCC revenue growth of 6% to 8%, adjusted EBITDA between $1.67 billion and $1.72 billion, and an adjusted EBITDA margin ranging from 55% to 55.8%. Additionally, Verisk plans to maintain its investment in innovation, highlighted by the introduction of new features across its digital platform, aiming for enhanced client value and sustained growth.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.