Verisk Analytics Price Target Adjusted to $320 by UBS
In a recent update, UBS has revised its price target for Verisk Analytics (VRSK) to $320, up from the previous target of $295. According to the firm, the stock’s outlook remains stable, but opportunities for significant growth appear limited. This adjustment was shared with investors through a research note, as reported by GuruFocus.
The updated price target by UBS reflects a more optimistic view of Verisk Analytics’ future performance. However, the firm maintains a Neutral rating on the stock, suggesting that investors should exercise caution when making investment decisions. As noted by GuruFocus, “Despite maintaining a Neutral rating on the stock, the firm notes a stable outlook, though opportunities for significant growth appear limited.”
Wall Street Analysts’ Forecasts for Verisk Analytics
According to data compiled by GuruFocus, the average one-year price target for Verisk Analytics is $304.96, based on estimates from 15 analysts. This average target implies a downside of 1.47% from the current price of $309.50. The high estimate is $340.00, while the low estimate is $232.37.
The consensus recommendation from 19 brokerage firms, as reported by GuruFocus, is currently 2.5, indicating an “Outperform” status. This rating scale ranges from 1 to 5, where 1 signifies a Strong Buy, and 5 denotes a Sell.
GuruFocus Estimates for Verisk Analytics
Based on GuruFocus estimates, the estimated GF Value for Verisk Analytics in one year is $310.30, suggesting an upside of 0.26% from the current price of $309.50. The GF Value is an estimate of the fair value that the stock should be traded at, calculated based on historical multiples, past business growth, and future estimates of business performance.
Verisk Analytics’ Key Business Developments
In its recent quarterly report, Verisk Analytics disclosed several key business developments, as reported by GuruFocus. These include:
* Revenue: $753 million, up 7% year-over-year
* Net Income: $232 million, up 6% year-over-year
* Diluted GAAP EPS: $1.65, up 9% year-over-year
* Organic Constant Currency Revenue Growth: 7.9%
* Subscription Revenue Growth: 10.6% on an OCC basis
* Adjusted EBITDA Growth: 9.5% on an OCC basis
* Adjusted EBITDA Margin: 55.3%, up 130 basis points year-over-year
* Free Cash Flow: $391 million, up 23% year-over-year
* Cash Dividend: $0.45 per share, a 15% increase from the prior year
* Share Repurchase Program: $200 million accelerated share repurchase completed in April
The company’s 2025 revenue guidance is $3.03 billion to $3.08 billion, with an adjusted EBITDA guidance of $1.67 billion to $1.72 billion and an adjusted EPS guidance of $6.80 to $7.10.
Positive Points for Verisk Analytics
According to GuruFocus, several positive points can be noted about Verisk Analytics:
* The company reported strong first-quarter results with a 7.9% organic constant currency revenue growth, driven by a 10.6% increase in subscription growth.
* Verisk Analytics achieved a 130 basis points margin expansion, resulting in a 9.5% growth in OCC adjusted EBITDA.
* The company has a durable subscription-based economic model, with 83% of its total revenue coming from subscriptions, which grew 10.6% on an OCC basis.
* Verisk Analytics is actively investing in new solutions, such as the Verisk Synergy Studio, a cloud-native catastrophe modeling platform set to launch in 2026.
* The company is committed to returning capital to shareholders, having paid a 15% increased cash dividend and completed a $200 million accelerated share repurchase program.
Negative Points for Verisk Analytics
However, GuruFocus also noted several negative points:
* The company faces challenges from an uncertain risk environment, including inflation, regulatory changes, and severe weather events.
* Transactional revenues, which comprise 17% of total revenues, declined by 4% on an OCC basis during the first quarter.
* Verisk Analytics experienced headwinds in its marketing business, particularly in non-insurance segments like financial services and mortgages.
* The company anticipates a potential challenge in maintaining the same trajectory of margin expansion as seen in previous years.
* Higher net interest expenses were reported, resulting from increased debt balances and higher interest rates.
In conclusion, Verisk Analytics’ updated price target by UBS reflects a more optimistic view of the company’s future performance. However, investors should exercise caution when making investment decisions, considering both the positive and negative points about the company. As reported by GuruFocus, the company’s stable outlook and strong quarterly results are encouraging, but challenges from an uncertain risk environment and potential headwinds in its marketing business should not be ignored.
Source link
