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VRSK – Market expectations are for slight Uniform ROA improvement, and management is confident about end market strength, innovation, and strategies

July 9, 2020

  • Verisk Analytics, Inc. (VRSK:USA) currently trades at a historical high relative to UAFRS-based (Uniform) earnings, with a 35.9x Uniform P/E. At these levels, the market has bullish expectations for the firm, and management is confident about their end market strength, innovation investments, and strategies

  • Specifically, management generated an excitement marker when saying that the coronavirus impact on Q1 results was modest. In addition, they are confident customers in each of their 3 vertical markets will generate returns faster when implementing Verisk solutions, and that they continue to manage and deliver core operating leverage. Moreover, they are confident their rate of innovation investment for the future is unabated and that they modestly trimmed and realigned labor headcount. Furthermore, they are confident they are less exposed to upstream oil and gas operations in their WoodMac business and that they have been successful with the progress they have made in the United Kingdom

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