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Verisk (VRSK) Gains on Acquisitions Despite Operational Risks
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Verisk Analytics (VRSK - Free Report) is benefitting from acquisitions, a customer-centric business model and liquidity amid operational risks.
VRSK reported mixed fourth-quarter 2023 results, wherein earnings missed the Zacks Consensus Estimate but revenues beat the same. Adjusted earnings were $1.4 per share, missing the Zacks Consensus Estimate by 1.4% and decreasing 2.1% year over year. Total revenues of $677.2 million surpassed the consensus estimate by 1% and increased 7.4% year over year on a reported basis and 6% on an organic constant-currency basis.
How Is VRSK Doing?
Acquisitions are important for Verisk's growth strategy, as it consistently invests in global companies to improve its data and analytics capabilities across various sectors. The recent acquisition of Rocket Enterprise Solutions GmbH should help VRSK to expand in Germany. The 2023 acquisition of Mavera is helping the company to expand in the European region and supporting its growth in the global insurance industry. Another acquisition Krug has expanded the claims and casualty services of Verisk across Europe.
Verisk’s business model and strategies are designed to cater to customers’ most pressing requirements, both from a cyclical and structural perspective. The combination of the company’s business model, strong customer relationships, and strategy to deliver value to its clients via decision-making and operational efficiency enables it to deliver value to shareholders through growth and returns. Such strategies are helpful in improving the bottom line.
Verisk's current ratio (measure of liquidity) at the end of fourth-quarter 2023 was pegged at 1.05, higher than the year-ago quarter’s 0.4. A current ratio of more than 1 often indicates that the company will easily pay off its short-term obligations. An increasing current ratio bodes well.
Verisk remains susceptible to operational risks related to security breaches in its facilities, databases and computer networks, resulting in the loss of its credibility and/or customers. Contractual and pricing issues might arise with the data suppliers due to their dependence on external sources for the data supply. Data theft and misuse by third-party contractors could also result in the loss of businesses and jeopardize the company’s fundamental existence.
TRU’s EPS of 70 cents per share (adjusting 67 cents from non-recurring items) surpassed the consensus mark by 14.8% in the fourth quarter and was flat on a year-over-year basis. Total revenues of $954.3 million surpassed the consensus mark by 3% and increased 5.8% year over year on a reported basis. Revenues rose 5% on a constant-currency basis, mainly driven by strength in the international markets.
ENV’s EPS, excluding $4 from non-recurring items, was 65 cents, surpassing the consensus estimate by 22.6%. The bottom line increased 44.4% from the year-ago quarter. Total revenues of $317.6 million beat the consensus estimate by 1.7%. The top line improved 8.5% on a year-over-year basis.
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Verisk (VRSK) Gains on Acquisitions Despite Operational Risks
Verisk Analytics (VRSK - Free Report) is benefitting from acquisitions, a customer-centric business model and liquidity amid operational risks.
VRSK reported mixed fourth-quarter 2023 results, wherein earnings missed the Zacks Consensus Estimate but revenues beat the same. Adjusted earnings were $1.4 per share, missing the Zacks Consensus Estimate by 1.4% and decreasing 2.1% year over year. Total revenues of $677.2 million surpassed the consensus estimate by 1% and increased 7.4% year over year on a reported basis and 6% on an organic constant-currency basis.
How Is VRSK Doing?
Acquisitions are important for Verisk's growth strategy, as it consistently invests in global companies to improve its data and analytics capabilities across various sectors. The recent acquisition of Rocket Enterprise Solutions GmbH should help VRSK to expand in Germany. The 2023 acquisition of Mavera is helping the company to expand in the European region and supporting its growth in the global insurance industry. Another acquisition Krug has expanded the claims and casualty services of Verisk across Europe.
Verisk’s business model and strategies are designed to cater to customers’ most pressing requirements, both from a cyclical and structural perspective. The combination of the company’s business model, strong customer relationships, and strategy to deliver value to its clients via decision-making and operational efficiency enables it to deliver value to shareholders through growth and returns. Such strategies are helpful in improving the bottom line.
Verisk's current ratio (measure of liquidity) at the end of fourth-quarter 2023 was pegged at 1.05, higher than the year-ago quarter’s 0.4. A current ratio of more than 1 often indicates that the company will easily pay off its short-term obligations. An increasing current ratio bodes well.
Verisk remains susceptible to operational risks related to security breaches in its facilities, databases and computer networks, resulting in the loss of its credibility and/or customers. Contractual and pricing issues might arise with the data suppliers due to their dependence on external sources for the data supply. Data theft and misuse by third-party contractors could also result in the loss of businesses and jeopardize the company’s fundamental existence.
Earnings Snapshots of Peers
TransUnion (TRU - Free Report) reported impressive fourth-quarter 2023 results.
TRU’s EPS of 70 cents per share (adjusting 67 cents from non-recurring items) surpassed the consensus mark by 14.8% in the fourth quarter and was flat on a year-over-year basis. Total revenues of $954.3 million surpassed the consensus mark by 3% and increased 5.8% year over year on a reported basis. Revenues rose 5% on a constant-currency basis, mainly driven by strength in the international markets.
Envestnet, Inc. (ENV - Free Report) posted impressive fourth-quarter 2023 results.
ENV’s EPS, excluding $4 from non-recurring items, was 65 cents, surpassing the consensus estimate by 22.6%. The bottom line increased 44.4% from the year-ago quarter. Total revenues of $317.6 million beat the consensus estimate by 1.7%. The top line improved 8.5% on a year-over-year basis.