Advertisement
Australia markets close in 2 hours 57 minutes

  • ALL ORDS

    7,847.90
    -89.60 (-1.13%)
     

  • ASX 200

    7,586.00
    -97.00 (-1.26%)
     

  • AUD/USD

    0.6525
    +0.0002 (+0.02%)
     

  • OIL

    83.85
    +0.28 (+0.34%)
     

  • GOLD

    2,346.50
    +4.00 (+0.17%)
     

  • Bitcoin AUD

    98,750.12
    +386.05 (+0.39%)
     

  • CMC Crypto 200

    1,392.71
    +10.13 (+0.73%)
     

  • AUD/EUR

    0.6082
    +0.0009 (+0.14%)
     

  • AUD/NZD

    1.0944
    -0.0014 (-0.12%)
     

  • NZX 50

    11,842.58
    -103.85 (-0.87%)
     

  • NASDAQ

    17,430.50
    -96.30 (-0.55%)
     

  • FTSE

    8,078.86
    +38.48 (+0.48%)
     

  • Dow Jones

    38,085.80
    -375.12 (-0.98%)
     

  • DAX

    17,917.28
    -171.42 (-0.95%)
     

  • Hang Seng

    17,582.88
    +298.34 (+1.73%)
     

  • NIKKEI 225

    37,780.35
    +151.87 (+0.40%)
     

S&P Global (SPGI) Stock Rises 18.9% in a Year: Here's Why

Zacks Equity Research
·4-min read

Shares of S&P Global Inc. SPGI have gained 18.9% over the past year, outperforming the 0.5% decline of the industry it belongs to.

Let’s delve into factors that have contributed to the company’s outperformance.

Consecutive Earnings & Revenue Beat

S&P Global reported back-to-back earnings and revenue beat in the last seven quarters. While the bottom line gained from revenue growth and benefits of productivity initiatives, the top line performed well on the back of strength across all segments, namely S&P Global Ratings, S&P Global Market Intelligence, S&P Global Platts, and S&P Dow Jones Indices.

Strategic Acquisitions Bode Well

Acquisitions have been a key growth strategy for S&P Global, helping it continuously innovate, increase differentiated content and develop new products.

ADVERTISEMENT

In 2020, the company completed the acquisitions of ESG Ratings Business (from RobecoSAM) and Greenwich Associates LLC. While ESG Ratings Business will boost the company’s position as a premier resource for essential ESG data, ratings, benchmarks and insights, Greenwich will complement its existing portfolio of products and expand its offerings to new segments across financial services, including commercial banks, and asset and wealth managers.

In 2019, the company acquired 451 Research, Canadian Enerdata, Live Rice Index and Orion technology center. 451 Research strengthened S&P Global Market Intelligence's emerging technology expertise and offerings. Canadian Enerdata enhanced S&P Global Platts division's energy-analytical capabilities and strengthened its foothold in the North American natural gas market. Live Rice Index is a great addition to Platts’ global agriculture offering. Orion technology center provides the company’s employees access to the latest technologies and global communications infrastructure.

The company is expected to continue adding advanced technology and data sets through acquisitions, which in turn should boost its top- and bottom-line growth.

Shareholder-Friendly Moves

Recently, S&P Global's board of directors declared a dividend hike of 15%, thereby raising the quarterly cash dividend from 67 cents per share to 77 cents. The new dividend will be paid on Mar 10, 2021, to shareholders of record on Feb 24, 2021. The new annualized dividend rate is $3.08 per share.

During 2020, the company returned $1.8 billion to shareholders. This included $1.2 billion through share repurchases and $645 million through dividend payments. In 2019, S&P Global returned $1.8 billion to shareholders with $1.2 billion in share repurchases and $560 million in dividends. In 2018, the company returned $2.2 billion to shareholders, which includes $1.7 billion through share repurchases and $503 million in dividend payments.

Such consistent shareholder-friendly moves indicate the company’s commitment to create value for shareholders and underline its confidence in its business. These initiatives not only instill investors’ confidence but also positively impact earnings per share.

Zacks Rank and Stocks to Consider

S&P global currently carries a Zacks Rank #3 (Hold).

Some better-rankedstocks in the broader Zacks Business Services sector are Interpublic IPG,Omnicom OMC and NV5 Global NVEE, each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The long-term expected earnings per share (three to five years) growth rate for Interpublic, Omnicomand NV5 Global is 2.4%, 4.7% and 16.8%, respectively.

Bitcoin, Like the Internet Itself, Could Change Everything

Blockchain and cryptocurrency has sparked one of the most exciting discussion topics of a generation. Some call it the “Internet of Money” and predict it could change the way money works forever. If true, it could do to banks what Netflix did to Blockbuster and Amazon did to Sears. Experts agree we’re still in the early stages of this technology, and as it grows, it will create several investing opportunities.

Zacks’ has just revealed 3 companies that can help investors capitalize on the explosive profit potential of Bitcoin and the other cryptocurrencies with significantly less volatility than buying them directly.

See 3 crypto-related stocks now >>


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Omnicom Group Inc. (OMC) : Free Stock Analysis Report

Interpublic Group of Companies, Inc. The (IPG) : Free Stock Analysis Report

NV5 Global, Inc. (NVEE) : Free Stock Analysis Report

S&P Global Inc. (SPGI) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research