Shares of IHS Markit Ltd. INFO scaled a 52-week high of $101.45 in the trading session on Nov 30, before closing a tad lower at $99.46.
The company’s shares have charted a solid trajectory in the recent times, appreciating 32% year to date, ahead of 4% growth of the industry and 13.3% rise of the Zacks S&P 500 composite.
Notably, IHS Markit has witnessed a 28.5% rise in share price since it posted third-quarter fiscal 2020 results.
Let’s find out what’s supporting the uptick.
Consecutive Earnings Beat
IHS Markit reported consecutive better-than-expected bottom-line performance in the last six quarters. Solid operating performance is likely to have driven the company’s bottom line.
Although many companies across diverse sectors have suspended dividend payouts and share buybacks amid the coronavirus crisis, IHS Markit is one of the few continuing to reward shareholders.
On Oct 15, 2020, the company’s board of directors declared a quarterly cash dividend of 17 cents per share for the fourth quarter of 2020. The dividend was paid on Nov 16 to shareholders of record at the close of business on Oct 30, 2020.
IHS Markit has a track record of consistent share repurchases and dividend payments. In the first nine months of fiscal 2020, the company repurchased shares worth $750 million and paid out dividends of $203 million. During fiscal 2019 and fiscal 2018, the company repurchased shares worth $500 million and $672.5 million, respectively.
Diversified Global Customer Base
IHS Markit is benefiting from a well-diversified global customer base and strong brand recognition. The company has a consultative product development approach, which means that it works closely with its customers in introducing offerings and enhancing the established ones. This, in turn, has helped it build strong customer relations over time. Currently, IHS Markit’s offerings are well established across multiple industries and geographies. The company intends to continue innovating and developing new product offerings, and investing primarily in automotive, energy and financial services.
Zacks Rank and Stocks to Consider
IHS Markit currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader Zacks Business Services sector are Heidrick & Struggles International HSII, Automatic Data Processing ADP and Insperity NSP, each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The long-term expected earnings per share (three to five years) growth rate for Heidrick & Struggles International, Automatic Data Processing and Insperity is 10%, 12% and 15%, respectively.
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Automatic Data Processing, Inc. (ADP) : Free Stock Analysis Report
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