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Verisk (VRSK) Scales New 52-Week High: What’s Driving It?


Shares of Verisk Analytics, Inc. VRSK scaled a new 52-week high of $121.82 during the trading session on Sep 7, before closing a tad lower at $120.43.

The company’s shares have charted a solid trajectory in recent times, appreciating 25.4% year to date, ahead of the 18.4% rise of the industry it belongs to.

Notably, the company has witnessed a 17.8% rise in share price since it posted strong second-quarter 2018 results.

Let’s find out what’s supporting the rally.

Strategic Acquisitions

Acquisitions have been contributing to Verisk’s bottom line. The company has been continuously acquiring and investing in companies globally to expand its data and analytics capabilities across industries. From 2015-2017, the company completed 21 acquisitions. In 2018 so far, the company has acquired three companies — Validus-IVC Limited, Business Insight Limited and Marketview Limited. While 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.

Higher Organic Revenue Growth

Higher organic revenue growth through a combination of increase in new customers for existing solutions, cross-sale of its existing solutions to current customers and the sale of new solutions will help Verisk create long-term value. In first half of 2018, total revenues grew 8.3% organically and 7.2% on an organic constant-currency basis. This marks an improvement from 2017, wherein total revenues grew 4.5% organically and 5.3% on an organic constant currency basis.

Data Analytics Suite

Verisk’s expertise in providing predictive data analytics decision by using advanced technologies to collect and interpret different types of data sets looks impressive. The company mainly uses advanced technologies such as latest remote sensing and machine learning technologies along with cloud computing. The majority of the technologies used by Verisk are developed, maintained and supported by almost 20% of its employees. Efforts to stay technologically updated to meet varying client demands and its technical prowess in analytics and Big Data provide Verisk an unrivalled edge over its competitors.

Zacks Rank & 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.

Some better-ranked stocks in the broader Business Services sector include Heidrick & Struggles International HSII, BG Staffing BGSF and FactSet FDS. While Heidrick & Struggles International sports a Zacks Rank #1, BG Staffing and FactSet carry a Zacks Rank #2 (Buy).

The long-term expected EPS (three to five years) growth rate for Heidrick & Struggles International, BG Staffing and FactSet is 13.5%, 20% and 10.6%, respectively.

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