Verisk Analytics, Inc. VRSK reported mixed first-quarter 2022 results, wherein earnings missed the Zacks Consensus Estimate but revenues surpassed the same.
Adjusted earnings per share (excluding $1.79 from non-recurring items) of $1.34 missed the consensus mark by 3.6% but grew 8.9% on a year-over-year basis. The upside was backed by organic growth within the business, lower interest expenses and a lower average share count.
Revenues of $775.5 million beat the consensus estimate by 0.7% and increased 6.8% year over year on a reported basis and 5.3% on an organic constant-currency (cc) basis.
Over the past year, shares of Verisk have improved 16% against an 18.1% decline of the industry it belongs to.
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Insurance segment revenues totaled $586.4 million, up 9.5% year over year on a reported basis and 6.1% on an organic cc basis.
Within the segment, underwriting and rating revenues of $416 million rose 10.3% on a reported basis and 6.4% on an organic cc basis. The upside was primarily driven by an annual increase in prices derived from continued enhancements of the solutions’ contents within the industry-standard insurance programs and the sale of expanded solutions to existing customers in commercial and personal lines.
Claims revenues amounted to $170.4 million, improving 7.5% on a reported basis and 5.3% on an organic cc basis. The top line was primarily driven by claims analytics revenues and property estimating solutions.
Verisk Analytics, Inc. Price, Consensus and EPS Surprise
Verisk Analytics, Inc. price-consensus-eps-surprise-chart | Verisk Analytics, Inc. Quote
Energy and Specialized Markets segment’s revenues of $154.3 million decreased 1.2% year over year on a reported basis but increased 1.9% on an organic cc basis. The uptick in organic cc basis was primarily driven by subscription and consulting revenues.
Financial Services segment’s revenues of $34.8 million grew 1.6% year over year. The segment’s growth was primarily on portfolio management and spend informed analytics, offset by lower bankruptcy volumes.
Adjusted EBITDA of $359.3 million increased 4% on a reported basis and 4.1% on an organic cc basis. Adjusted EBITDA margin fell to 46.3% from 47.6% in the prior-year quarter.
Balance Sheet and Cash Flow
Verisk exited first-quarter 2022 with cash and cash equivalents of $397.9 million compared with $280.3 million at the end of the prior-year quarter. Long-term debt was $2.34 billion, flat with the prior-year quarter’s level.
Verisk generated $399.6 million of cash from operating activities while capex was $60 million. Free cash flow was $339.6 million.
Share Repurchase & Dividend Payout
During the March quarter, Verisk paid out a total cash dividend of $49.4 million.
In the reported quarter, VRSK bought back approximately 3,053 thousand shares at an average price of $187.17 for a total cost of $571.3 million for the first quarter of 2022. As of Mar 31, 2022, VRSK had $1,032.5 million remaining under the share repurchase authorization.
Currently, Verisk carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Within the broader Business Services sector, ManpowerGroup Inc. MAN, Omnicom Group Inc. OMC and Equifax Inc. EFX recently reported first-quarter 2022 results.
ManpowerGroup reported impressive first-quarter 2022 results, with both earnings and revenues beating the Zacks Consensus Estimate. Quarterly adjusted earnings of $1.88 per share beat the consensus mark by 20.5% and improved 69.4% year over year. Revenues of $5.14 billion surpassed the consensus mark by 0.7% and inched up 4.5% year over year on a reported basis and 9.8% on a constant-currency (cc) basis.
Omnicom reported impressive first-quarter 2022 results as both earnings and revenues surpassed the Zacks Consensus Estimate. Earnings of $1.39 per share beat the consensus mark by 8.6% and increased 4.5% year over year, driven by a strong margin performance. Total revenues of $3.4 billion surpassed the consensus estimate by 5.4% but declined slightly year over year.
Equifax reported better-than-expected first-quarter 2022 results. Adjusted earnings of $2.22 per share beat the Zacks Consensus Estimate by 3.3% and improved 13% on a year-over-year basis. Revenues of $1.36 billion outpaced the consensus estimate by 2.4% and improved 12.4% year over year on a reported basis and 13% on a local-currency basis.
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