IHS Markit Ltd. (INFO - Free Report) reported mixed second-quarter fiscal 2020 results, with earnings beating the Zacks Consensus Estimate but revenues missing the same.
Adjusted earnings per share of 69 cents beat the consensus mark by 6.2% but decreased 3% on a year-over-year basis. Total revenues came in at $1.03 billion, missing the consensus mark by 2.1% and declining 10% from the year-ago quarter on a reported basis. Revenues declined 7% organically.
Shares of IHS Markit have gained 23% over the past year, outperforming the 18.1% rally of the industry it belongs to.
Revenues at the Resources segment totaled $219 million, down 12% year over year on a reported basis and 14% organically. The Transportation segment witnessed year-over-year revenue decline of 24% on a reported basis and 18% organically to reach $243 million.
Revenues at the Consolidated Markets & Solutions segment amounted to $121 million, down 10% year over year on a reported basis but up 2% organically. Financial services segment’s revenues increased 2% year over year to $444 million, with 3% organic growth.
Recurring fixed revenues of $755.2 million were down 4% year over year on a reported basis and 1% on an organic basis. Recurring variable revenues of $158 million grew 9% year over year on a reported basis and 10% on an organic basis. Non-recurring revenues totaled $113 million, down 45% year over year on a reported basis and 40% on an organic basis.
Adjusted EBITDA of $454 million declined 2% from the year-ago quarter. Adjusted EBITDA margin improved 320 points (bps) year over year to 44.2%.
IHS Markit ended the quarter with cash and cash equivalent balance of $207.8 million compared with $143.9 million in the prior quarter. Long-term debt was $5.1 billion compared with $5 billion in the previous quarter.
Cash flow from operations and free cash flow amounted to $278.2 million and $208.6 million respectively in the quarter. CapEx was $69.6 million. The company repurchased $250 million of shares and paid out $67.7 million in dividends in the quarter.
Zacks Rank and Stocks to Consider
Currently, IHS Markit has a Zacks Rank #3 (Hold).
Stocks that Warrant a Look
Here are a few stocks from the Zacks Business Services sector that are likely to beat on earnings this season.
Kforce (KFRC - Free Report) , with an Earnings ESP of +24.53% and a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
CoreLogic (CLGX - Free Report) , with an Earnings ESP of +5.05% and a Zacks Rank of 3.
Republic Services (RSG - Free Report) , with an Earnings ESP of +10.04% and a Zacks Rank #3.
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