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Here's Why Investor Should Hold S&P Global (SPGI) Stock Now

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S&P Global Inc. (SPGI - Free Report) is currently benefiting from its acquisitions and pro-investor steps.

SPGI’s revenues are anticipated to grow 40.7% and 6.6% in 2022 and 2023, respectively. Shares of SPGI have jumped 4.2% in the past three-month period compared with 0.3% rise of the industry it belongs to.

Zacks Investment Research
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Factors That Augur Well

Acquisitions have always carved a key growth trajectory for S&P Global. The recent buyout of IHS Markit is expected to enhance its data and analytics offerings. Another acquisition of The Climate Service is expected to enhance SPGI's portfolio of essential environmental, social and governance insights and solutions.

We are impressed with S&P Global’s endeavors to reward its shareholders through share repurchases and dividend payments. In 2021, S&P Global returned $743 million to its shareholders in the form of dividend payments. However, it did not repurchase any shares last year due to the pending merger with IHS Markit.

In 2020, SPGI returned $1.8 billion to its shareholders, $1.2 billion through share repurchases and $645 million as dividend payouts. In 2019, S&P Global returned $1.8 billion to its shareholders with $1.2 billion as share repurchases and $560 million of dividend payments.

Such shareholder-friendly moves underpin S&P Global’s commitment of creating value for its shareholders and underlining its confidence in its business. These initiatives not only raise investors’ optimism on the stock but also positively impact the earnings per share.

A Key Risk

S&P Global's current ratio (a measure of liquidity) at the end of third-quarter 2022 was pegged at 0.83, lower than the current ratio of 1.26 reported at the end of second-quarter 2022 and the prior-year quarter’s 2.26. Decreasing current ratio is not desirable as it indicates that the company may have problems meeting its short-term debt obligations.

Zacks Rank and Stocks to Consider

S&P Global currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Some better-ranked stocks in the broader Zacks Business Services sector are Booz Allen Hamilton Holding Corporation (BAH - Free Report) and Cross Country Healthcare, Inc. (CCRN - Free Report) .

Booz Allen carries a Zacks Rank #2 (Buy) at present. BAH has a long-term earnings growth expectation of 8.9%.

Booz Allen delivered a trailing four-quarter earnings surprise of 8.8%, on average.

Cross Country Healthcare is currently Zacks #2 Ranked. CCRN has a long-term earnings growth expectation of 6%.

CCRN delivered a trailing four-quarter earnings surprise of 10.1%, on average.
 

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