February 27, 2013
Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of Verisk Analytics (NASDAQ: VRSK ) jumped 10% today after the company reported fourth-quarter earnings.
So what: Revenue rose 18% to $415.7 million and topped estimates of $409.6 million from analysts. On the bottom line, earnings per share rose 34% from a year ago to $0.63, easily hurdling the $0.54 bar Wall Street had set.
Now what: Verisk had strong growth across its business, with health-care revenue nearly doubling from a year ago. The challenge is that some of that revenue was due to acquisitions -- health care's organic growth of 28.5% was far lower than 89.1% overall growth. With shares trading at 23 times forward earnings, I'd like to see more organic growth from the business. This quarter was great, but I'd prefer to see a pullback before jumping in at inflated prices.
Interested in more info on Verisk Analytics? Add it to your watchlist by clicking here.