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Verisk (VRSK) Q2 Earnings Miss Estimates, Revenues Beat
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Verisk Analytics, Inc.(VRSK - Free Report) reported mixed second-quarter 2021 results, with earnings lagging the Zacks Consensus Estimate while revenues beating the same.
Adjusted earnings per share of $1.17 missed the consensus mark by 12.7% and fell 9.3% on a year-over-year basis. The downside was backed by higher effective tax rate, partially offset by organic growth in the business, contributions from acquisitions and lower average share count.
Revenues of $747.5 million beat the consensus estimate by 2% and increased 10.1% year over year on a reported basis and 6.3% on an organic constant-currency (cc) basis.
So far this year, shares of Verisk have declined 9.1% compared with 16.7% growth of the industry it belongs to and 20.3% increase of the Zacks S&P 500 composite.
Image Source: Zacks Investment Research
Segmental Performance
Insurance segment revenues totaled $550 million, up 11.8% year over year on a reported basis and 7.8% on an organic cc basis.
Within the segment, underwriting and rating revenues of $388.4 million rose 11.2% on a reported basis and 7.6% on an organic cc basis. The upside was primarily driven by an annual increase in prices derived from continued enhancements of the solutions’ contents within the industry-standard insurance programs, sale of expanded solutions to existing customers in commercial and personal lines, and contributions from catastrophe-modeling services and international software solutions.
Claims revenues amounted to $161.6 million, improving 13.2% on a reported basis and 8.4% on an organic cc basis. The top line was positively impacted by repair cost estimating solutions revenues and claims analytics revenues.
Energy and Specialized Markets segment revenues of $162.3 million increased 9.2% year over year on a reported basis and 5% on an organic cc basis. The uptick can be attributed to contributions from consulting, and environmental health and safety service revenues.
Financial Services segment revenues of $35.2 million declined 7.4% year over year on a reported basis and 8.1% on an organic cc basis. The segment was weighed down by certain contract transitions, projects that did not reoccur and lower bankruptcy volumes, which had offset strength in spend informed analytics revenues.
Operating Results
Adjusted EBITDA of $370.8 million increased 6.5% on a reported basis and 4.2% on an organic cc basis. Adjusted EBITDA margin fell to 49.6% from 51.3% in the prior-year quarter.
Verisk Analytics, Inc. Price, Consensus and EPS Surprise
Verisk generated $233.2 million of cash from operating activities and capex was $62.5 million. Free cash flow was $170.7 million.
Share Repurchases & Dividend Payout
The company paid out a cash dividend of 29 cents per share on Jun 30. On Jul 28, the company's board of directors approved a quarterly cash dividend of 29 cents, payable on Sep 30, 2021, to holders of record as of Sep 15, 2021.
During the reported quarter, Verisk repurchased almost 834,000 shares at an average price of $179.85 per share, for a total cost of $150 million. As of Jun 30, 2021, the company had $328.8 million available under its share repurchase authorization.
Equifax’s (EFX - Free Report) second-quarter 2021 adjusted earnings of $1.98 per share beat the Zacks Consensus Estimate by 15.8% and improved on a year-over-year basis. Revenues of $1.23 billion outpaced the consensus estimate by 6.4% and improved 26% year over year on a reported basis and 23% on a local-currency basis.
Robert Half’s (RHI - Free Report) second-quarter 2021 earnings of $1.33 per share beat the consensus mark by 26.7% and were up more than 100% year over year. Revenues of $1.6 billion surpassed the consensus mark by 6.5% and increased 42.3% year over year on a reported basis and 40% on an adjusted basis.
ManpowerGroup’s (MAN - Free Report) second-quarter 2021 adjusted earnings of $2.02 per share beat the consensus mark by 68.2% and improved more than 100%. Revenues of $5.28 billion beat the consensus mark by 2% and inched up 41% year over year on a reported basis and 31.3% on a constant-currency (cc) basis.
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Verisk (VRSK) Q2 Earnings Miss Estimates, Revenues Beat
Verisk Analytics, Inc.(VRSK - Free Report) reported mixed second-quarter 2021 results, with earnings lagging the Zacks Consensus Estimate while revenues beating the same.
Adjusted earnings per share of $1.17 missed the consensus mark by 12.7% and fell 9.3% on a year-over-year basis. The downside was backed by higher effective tax rate, partially offset by organic growth in the business, contributions from acquisitions and lower average share count.
Revenues of $747.5 million beat the consensus estimate by 2% and increased 10.1% year over year on a reported basis and 6.3% on an organic constant-currency (cc) basis.
So far this year, shares of Verisk have declined 9.1% compared with 16.7% growth of the industry it belongs to and 20.3% increase of the Zacks S&P 500 composite.
Image Source: Zacks Investment Research
Segmental Performance
Insurance segment revenues totaled $550 million, up 11.8% year over year on a reported basis and 7.8% on an organic cc basis.
Within the segment, underwriting and rating revenues of $388.4 million rose 11.2% on a reported basis and 7.6% on an organic cc basis. The upside was primarily driven by an annual increase in prices derived from continued enhancements of the solutions’ contents within the industry-standard insurance programs, sale of expanded solutions to existing customers in commercial and personal lines, and contributions from catastrophe-modeling services and international software solutions.
Claims revenues amounted to $161.6 million, improving 13.2% on a reported basis and 8.4% on an organic cc basis. The top line was positively impacted by repair cost estimating solutions revenues and claims analytics revenues.
Energy and Specialized Markets segment revenues of $162.3 million increased 9.2% year over year on a reported basis and 5% on an organic cc basis. The uptick can be attributed to contributions from consulting, and environmental health and safety service revenues.
Financial Services segment revenues of $35.2 million declined 7.4% year over year on a reported basis and 8.1% on an organic cc basis. The segment was weighed down by certain contract transitions, projects that did not reoccur and lower bankruptcy volumes, which had offset strength in spend informed analytics revenues.
Operating Results
Adjusted EBITDA of $370.8 million increased 6.5% on a reported basis and 4.2% on an organic cc basis. Adjusted EBITDA margin fell to 49.6% from 51.3% in the prior-year quarter.
Verisk Analytics, Inc. Price, Consensus and EPS Surprise
Verisk Analytics, Inc. price-consensus-eps-surprise-chart | Verisk Analytics, Inc. Quote
Cash Flow
Verisk generated $233.2 million of cash from operating activities and capex was $62.5 million. Free cash flow was $170.7 million.
Share Repurchases & Dividend Payout
The company paid out a cash dividend of 29 cents per share on Jun 30. On Jul 28, the company's board of directors approved a quarterly cash dividend of 29 cents, payable on Sep 30, 2021, to holders of record as of Sep 15, 2021.
During the reported quarter, Verisk repurchased almost 834,000 shares at an average price of $179.85 per share, for a total cost of $150 million. As of Jun 30, 2021, the company had $328.8 million available under its share repurchase authorization.
Currently, Verisk carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Business Services Companies
Equifax’s (EFX - Free Report) second-quarter 2021 adjusted earnings of $1.98 per share beat the Zacks Consensus Estimate by 15.8% and improved on a year-over-year basis. Revenues of $1.23 billion outpaced the consensus estimate by 6.4% and improved 26% year over year on a reported basis and 23% on a local-currency basis.
Robert Half’s (RHI - Free Report) second-quarter 2021 earnings of $1.33 per share beat the consensus mark by 26.7% and were up more than 100% year over year. Revenues of $1.6 billion surpassed the consensus mark by 6.5% and increased 42.3% year over year on a reported basis and 40% on an adjusted basis.
ManpowerGroup’s (MAN - Free Report) second-quarter 2021 adjusted earnings of $2.02 per share beat the consensus mark by 68.2% and improved more than 100%. Revenues of $5.28 billion beat the consensus mark by 2% and inched up 41% year over year on a reported basis and 31.3% on a constant-currency (cc) basis.