Fannie Mae, Freddie Mac shares tumble after conservatorship comments
On Wednesday, BMO Capital Markets adjusted its price target for Verisk Analytics (NASDAQ:VRSK), a leading data analytics provider to the insurance industry, citing the company’s robust position in the market. Analyst Jeffrey Silber increased the target to $304.00, up from the previous $297.00, while maintaining a Market Perform rating on the stock. According to InvestingPro data, the stock appears overvalued at current levels, despite impressive gross profit margins of nearly 69% and a strong one-year return of 34%.
Silber highlighted Verisk’s role as the most "risk-off" stock within their Information Services (NASDAQ:III) coverage, noting the relative stability of the insurance end markets compared to other sectors. The analyst pointed out that despite increased losses, premium increases have put the insurance industry on more solid ground. Recent natural disasters, such as hurricanes and wildfires, could potentially enhance the company’s Claims performance. InvestingPro analysis reveals the company’s solid financial health with a "GOOD" overall score and strong profitability metrics, including a return on assets of 22%.
Verisk’s conservative approach to maintaining its annual guidance was also mentioned, with the expectation that management will continue this trend, given the early stage of the fiscal year. Silber regards Verisk as a leader in its field, with a competitive advantage stemming from its extensive multi-decade data collection, which is invaluable for assisting clients in measuring risk.
The stock has performed well recently, driven by a concentrated focus on insurance, the defensive nature of the industry, and a business model perceived as more predictable. This performance has been further supported by new management guidance. According to Silber, investor attention may soon expand beyond Verisk’s core Property and Casualty offerings to include new product lines and geographies, with the aim of capturing a larger share of the annual insurance spend. InvestingPro subscribers can access 13 additional investment tips and a comprehensive Pro Research Report, which provides deep-dive analysis of Verisk’s market position, valuation, and growth prospects among 1,400+ top US stocks.
In other recent news, Verisk Analytics has seen several notable developments. RBC Capital Markets has raised its price target for Verisk to $314, citing strong revenue growth in subscription services and the company’s ability to leverage market volatility. The firm anticipates significant growth in subscription revenue by the first quarter of 2025, supported by record sales and effective pricing strategies. Meanwhile, BMO Capital Markets also increased its price target for Verisk to $297, acknowledging a slight beat in adjusted earnings per share for the fourth quarter, driven by growth in the Underwriting and Claims segments. However, BMO noted that Verisk’s guidance for 2025 was lighter than expected, although historical trends suggest potential upward revisions.
Additionally, Verisk has formed strategic alliances to enhance its service offerings. In a partnership with Cygnus Marketing Communications, Verisk aims to improve higher education marketing by integrating privacy-focused data with marketing intelligence systems. Another collaboration with GearTrack focuses on combating cargo theft by combining real-time tracking with theft data analytics. These partnerships highlight Verisk’s commitment to innovation and expanding its market capabilities.
RBC Capital Markets maintains an Outperform rating on Verisk, emphasizing the company’s position as a defensive stock in the Information Services sector. Despite some concerns about pricing increases and the sustainability of subscription growth, Verisk’s strategic initiatives and financial performance continue to attract analyst attention and adjustments in stock ratings.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.