Verisk Analytics (VRSK) AI Stock Analysis

• Market Cap: $40.49B
• Dividend Yield: 0.58%
• Average Volume (3M): 1.05M
• Price to Earnings (P/E): 43.1
• Beta (1Y): 0.49
• Revenue Growth: 7.47%
• EPS Growth: 59.46%
• Country: US
• Employees: 7,800
• Sector: Industrials
• Sector Strength: 61
• Industry: Consulting Services
• EPS (TTM): 6.71
• Shares Outstanding: 139,944,610
• 10 Day Avg. Volume: 1,217,148
• 30 Day Avg. Volume: 1,047,506
• PEG Ratio: 0.73
• Price to Book (P/B): N/A
• Price to Sales (P/S): 13.88
• Price to Cash Flow (P/CF): 39.20
• P/FCF Ratio: 31.00
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $312.75
• Price Target Upside: 9.44% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 13

Verisk Analytics' overall score reflects solid earnings call performance and moderate technical indicators, balanced by concerns over financial strains and valuation pressures. Strong subscription growth and strategic innovation are positive, but declining revenues and liquidity concerns weigh on the score.

Positive Factors

Competitive Advantage

VRSK owns comprehensive and differentiated insurance industry data assets that would be nearly impossible for competitors to replicate.

Organic Revenue Growth

Organic revenue growth was better-than-expected in the quarter at +6.5%, led by Claims.

Subscription Revenue Growth

Subscription revenue growth accelerated with continued momentum attributable to Forms, Rules, and Loss costs renewal pricing and Extreme Event wins.

Negative Factors

EPS Outlook

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.

Stock Valuation

The valuation for Verisk is considered premium, with positive characteristics reasonably well reflected, which makes analysts cautious about aggressive buying.

Verisk Analytics Business Overview & Revenue Model

Company Description

Verisk 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 Money

Verisk 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.

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.

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.

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

• Technical Analysis Sentiment: Negative
• Last Price: 285.78
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For VRSK, the sentiment is Negative. The current price of 285.78 is below the 20-day moving average (MA) of 290.20, below the 50-day MA of 292.10, and above the 200-day MA of 278.42, indicating a neutral 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 Negative sentiment for VRSK.

Verisk Analytics Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BAH	75 Outperform	$13.69B	16.11	75.34%	1.92%	14.07%	116.33%
FCN	72 Outperform	$5.80B	20.68	13.21%	―	6.00%	-1.49%
TRU	69 Neutral	$15.80B	56.01	6.91%	0.53%	9.20%	―
VRSK	64 Neutral	$40.49B	43.13	463.98%	0.58%	7.47%	59.46%
EFX	63 Neutral	$28.01B	46.40	12.95%	0.69%	7.90%	10.00%
Sector *	62 Neutral	$7.68B	13.06	3.21%	3.34%	3.62%	-14.40%
EXPO	61 Neutral	$4.05B	37.75	28.05%	1.43%	4.05%	8.71%