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Verisk (VRSK) Scales New 52-Week High: What's Driving It?
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Shares of Verisk Analytics, Inc. (VRSK - Free Report) scaled a new 52-week high of $134.42 during the trading session on Apr 1, before closing a tad lower at $134.24.
Shares of the company have charted a solid trajectory in recent times, appreciating 23.1% year to date, ahead of the 19.1% rise of the industry it belongs to and 13.1% increase of the Zacks S&P 500 composite. Notably, the company has witnessed a 35.9% rise in share price since it posted fourth-quarter 2018 results.
Let’s find out what’s supporting the uptick.
Higher Organic Revenue Growth
Higher organic revenue growth through a combination of increase in new customers for existing solutions, cross-sale of existing solutions to current customers and the sale of new solutions enable Verisk to create long-term value. In 2018, total revenues grew 6.5% organically and 6.1% on an organic constant-currency basis. This marks an improvement from 2017 when total revenues grew 4.5% organically and 5.3% on an organic constant-currency basis.
Strategic Acquisitions Bode Well
Acquisitions have also been one of the key growth catalysts for Verisk. It has been continuously acquiring and investing in companies globally to expand data and analytics capabilities across industries. In 2018, the company acquired four companies — Rulebook (Dec 14), Validus-IVC Limited (Jun 20), Business Insight Limited (Feb 21) and Marketview Limited (Jan 5). While Rulebook should solidify Verisk's position in the global insurance market, the buyout of Validus will help improve and automate the claims settlement process. The other two acquisitions will help Verisk in its predictive analytics and consumer spending analytics decision making.
Initiates Dividend
In February 2019, Verisk’s board of directors declared dividend for the first time in its history. A cash dividend of 25 cents per share was paid on Mar 29, 2019 to shareholders of record as of Mar15, 2019.
The dividend payment reflects stable business, higher profit levels and cash flows as well as diversification in its capital return practices (as the company has been consistent in share repurchases). In 2018, Verisk repurchased shares worth $438.6 million. It also entered into a $75-million accelerated share repurchase (ASR) agreement.
The company expects the dividend-payment initiative to attract more investors.
A few better-ranked stocks in the broader Zacks Business Services sector are Insperity (NSP - Free Report) , Automatic Data Processing (ADP - Free Report) and FLEETCOR . While Insperity sports a Zacks Rank #1, FLEETCOR and Automatic Data Processing carry a Zacks Rank #2 (Buy). Long-term expected EPS (three to five years) growth rate for Insperity, Automatic Data Processing and FLEETCOR and is 18%, 13% and16.5%, respectively.
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This outperformance has not just been a recent phenomenon. From 2000 – 2018, while the S&P averaged +4.8% per year, our top strategies averaged up to +56.2% per year.
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Verisk (VRSK) Scales New 52-Week High: What's Driving It?
Shares of Verisk Analytics, Inc. (VRSK - Free Report) scaled a new 52-week high of $134.42 during the trading session on Apr 1, before closing a tad lower at $134.24.
Shares of the company have charted a solid trajectory in recent times, appreciating 23.1% year to date, ahead of the 19.1% rise of the industry it belongs to and 13.1% increase of the Zacks S&P 500 composite. Notably, the company has witnessed a 35.9% rise in share price since it posted fourth-quarter 2018 results.
Let’s find out what’s supporting the uptick.
Higher Organic Revenue Growth
Higher organic revenue growth through a combination of increase in new customers for existing solutions, cross-sale of existing solutions to current customers and the sale of new solutions enable Verisk to create long-term value. In 2018, total revenues grew 6.5% organically and 6.1% on an organic constant-currency basis. This marks an improvement from 2017 when total revenues grew 4.5% organically and 5.3% on an organic constant-currency basis.
Strategic Acquisitions Bode Well
Acquisitions have also been one of the key growth catalysts for Verisk. It has been continuously acquiring and investing in companies globally to expand data and analytics capabilities across industries. In 2018, the company acquired four companies — Rulebook (Dec 14), Validus-IVC Limited (Jun 20), Business Insight Limited (Feb 21) and Marketview Limited (Jan 5). While Rulebook should solidify Verisk's position in the global insurance market, the buyout of Validus will help improve and automate the claims settlement process. The other two acquisitions will help Verisk in its predictive analytics and consumer spending analytics decision making.
Initiates Dividend
In February 2019, Verisk’s board of directors declared dividend for the first time in its history. A cash dividend of 25 cents per share was paid on Mar 29, 2019 to shareholders of record as of Mar15, 2019.
The dividend payment reflects stable business, higher profit levels and cash flows as well as diversification in its capital return practices (as the company has been consistent in share repurchases). In 2018, Verisk repurchased shares worth $438.6 million. It also entered into a $75-million accelerated share repurchase (ASR) agreement.
The company expects the dividend-payment initiative to attract more investors.
Zacks Rank and Stocks to Consider
Currently, Verisk carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
A few better-ranked stocks in the broader Zacks Business Services sector are Insperity (NSP - Free Report) , Automatic Data Processing (ADP - Free Report) and FLEETCOR . While Insperity sports a Zacks Rank #1, FLEETCOR and Automatic Data Processing carry a Zacks Rank #2 (Buy). Long-term expected EPS (three to five years) growth rate for Insperity, Automatic Data Processing and FLEETCOR and is 18%, 13% and16.5%, respectively.
Today's Best Stocks from Zacks
Would you like to see the updated picks from our best market-beating strategies? From 2017 through 2018, while the S&P 500 gained +15.8%, five of our screens returned +38.0%, +61.3%, +61.6%, +68.1%, and +98.3%.
This outperformance has not just been a recent phenomenon. From 2000 – 2018, while the S&P averaged +4.8% per year, our top strategies averaged up to +56.2% per year.
See their latest picks free >>