S&P Global currently trades at $548.65 per share and has shown little upside over the past six months, posting a middling return of 3.7%. The stock also fell short of the S&P 500’s 10.5% gain during that period.
Is now the time to buy SPGI? Or does the price properly account for its business quality and fundamentals? Find out in our full research report, it’s free.
Why Are We Positive On SPGI?
Tracing its roots back to 1860 when it published the first railroad industry manual, S&P Global (NYSE: SPGI) provides credit ratings, market intelligence, commodity data, automotive analytics, and financial indices that help investors and businesses make decisions.
1. Long-Term Revenue Growth Shows Strong Momentum
A company’s long-term sales performance can indicate its overall quality. Any business can experience short-term success, but top-performing ones enjoy sustained growth for years.
Thankfully, S&P Global’s 13% annualized revenue growth over the last five years was solid. Its growth beat the average financials company and shows its offerings resonate with customers.
2. EPS Surges Higher Over the Last Two Years
While long-term earnings trends give us the big picture, we also track EPS over a shorter period because it can provide insight into an emerging theme or development for the business.
S&P Global’s EPS grew at a remarkable 18.6% compounded annual growth rate over the last two years, higher than its 10.2% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded.
3. Stellar ROE Showcases Lucrative Growth Opportunities
Return on equity (ROE) measures how effectively banks generate profit from each dollar of shareholder equity - a critical funding source. High-ROE institutions typically compound shareholder wealth faster over time through retained earnings, share repurchases, and dividend payments.
Over the last five years, S&P Global has averaged an ROE of 35.1%, exceptional for a company operating in a sector where the average shakes out around 10% and those putting up 25%+ are greatly admired. This shows S&P Global has a strong competitive moat.
Final Judgment
These are just a few reasons why S&P Global ranks highly on our list. With its shares lagging the market recently, the stock trades at 31.5× forward P/E (or $548.65 per share). Is now the time to initiate a position? See for yourself in our in-depth research report, it’s free.
Stocks We Like Even More Than S&P Global
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