Is S&P Global Stock a Buy Now?

 

POINT

  • S&P Global (NYSE: SPGI) shares surged following a strong Q4 2024 earnings report.
  • Demand for financial market intelligence and credit ratings continues to grow.
  • The company’s steady revenue growth and profitability outlook make it a compelling investment for 2025.

1. S&P Global’s Q4 Earnings and Stock Rally

Image source: S&p global



S&P Global is a leading financial analytics and data provider, offering services such as credit ratings, investment research, and market indices.

The company exceeded Wall Street estimates with its latest Q4 2024 earnings, fueling a rally in its stock price.

Key Q4 2024 Performance Metrics

  • Revenue Growth: 14% year-over-year (YoY) increase
  • Adjusted Earnings Per Share (EPS): $3.77, up 20% YoY
  • Credit Ratings Revenue: Up 31% YoY
  • Total Debt Issuance Rated: $3.9 trillion, a record high (up 54% YoY)

The company’s credit ratings business saw exceptional growth, expanding beyond investment-grade and high-yield debt to include structured finance products, contributing to a 62% revenue increase in this segment.

Additionally, S&P Global announced a new share repurchase program, reinforcing its commitment to enhancing shareholder value.


2. Growth Prospects and Market Outlook

Macroeconomic Tailwinds

  • Potential interest rate cuts: Lower rates could drive more corporate debt issuance, boosting demand for credit ratings.
  • Increased corporate funding activity: Strong capital markets support S&P Global’s services.
  • Ongoing demand for financial intelligence: Investors and institutions are relying more on data analytics, benefiting S&P Global’s business model.

Key Growth Drivers

  • Vitality Index – Expansion into New Sectors
    • CARFAX Car Listings data service
    • Energy Transition insights
    • LNG Price Assessments

S&P Global is broadening its business scope, tapping into automotive, energy, and commodities sectors to diversify revenue streams.


3. Investment Considerations – Should You Buy S&P Global Stock Now?

S&P Global remains a strong long-term investment, with steady growth and an expanding market presence. However, the stock is currently trading near all-time highs after gaining 24% over the past year.

Investment Takeaways

✅ Strengths

  • Consistent revenue and earnings growth
  • Expected increase in credit ratings demand amid lower interest rates
  • Shareholder-friendly policies (dividend increases and share buybacks)

⚠️ Potential Risks

  • High stock price may limit short-term upside
  • Economic downturns could reduce demand for credit ratings and financial analytics

Final Verdict – A Strong Long-Term Play

  • S&P Global’s dividend growth (current yield: 0.67%) and steady earnings make it an attractive long-term investment.
  • Investors may consider waiting for a pullback before initiating new positions.

Source: Motley Fool, Bloomberg, S&P Global Official Website

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