Verisk Analytics
VRSK
$189.75
+0.53%
Verisk Analytics is a leading data, analytics, and technology provider for the property-casualty insurance industry, offering underwriting, claims, and catastrophe modeling solutions. With roots tracing back to Insurance Services Office (ISO) founded in 1971, Verisk holds a dominant position as an essential utility-like partner for insurers, leveraging proprietary data and regulatory expertise. The current investor narrative centers on the threat of AI commoditizing its data moat, which has driven a sharp stock decline despite strong fundamentals, creating a debate between value opportunity and structural disruption risk.…
VRSK
Verisk Analytics
$189.75
Investment Opinion: Should I buy VRSK Today?
Rating & Thesis: We rate VRSK as a Buy, based on its dominant position in the P&C insurance data market, strong cash flow generation, and attractive valuation relative to history. The consensus analyst rating is 'buy' with an average target price of $237.12, implying a 21.7% upside from the current price of $194.85. The thesis is that the market has overcorrected for AI disruption fears, creating a value opportunity for long-term investors.
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VRSK 12-Month Price Forecast
The AI assessment is neutral with medium confidence. While Verisk's valuation is attractive and fundamentals are solid, the AI threat remains a significant overhang that could limit upside. The stock's underperformance relative to the market suggests persistent skepticism. If the company can demonstrate that AI enhances rather than disrupts its business, the stance would upgrade to bullish. Conversely, if revenue growth stalls or margins compress, a downgrade to bearish would be warranted.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Verisk Analytics's 12-month outlook, with a consensus price target around $237.12 and implied upside of +25.0% versus the current price.
Average Target
$237.12
0 analysts
Implied Upside
+25.0%
vs. current price
Analyst Count
—
covering this stock
Price Range
$185 - $275
Analyst target range
The target price range is $185.00 to $275.00, with a spread of $90, indicating moderate uncertainty. The high target of $275 implies a 41.1% upside, assuming the company successfully defends its data moat and AI disruption is limited. The low target of $185 suggests a 5.1% downside, pricing in margin compression or competitive losses. Recent ratings actions show a mix of upgrades and downgrades, with Raymond James upgrading to Strong Buy and B of A maintaining Neutral, reflecting divergent views on the AI threat. The wide range highlights the uncertainty surrounding Verisk's future, but the consensus remains positive, suggesting analysts see the current valuation as attractive.
Bulls vs Bears: VRSK Investment Factors
Verisk presents a classic value-versus-disruption debate. The bull case rests on its entrenched data moat, strong cash flows, and historically low valuation, while the bear case centers on AI commoditization and high leverage. Currently, the bearish sentiment has driven the stock to a 30% annual decline, but fundamentals remain solid, with 29.6% net margins and $1.127B FCF. The most critical tension is whether AI will truly erode Verisk's competitive advantage; if not, the stock is undervalued, but if yes, the moat could weaken significantly. Evidence is mixed, but the analyst consensus and historical valuation suggest the market may have overreacted, tilting the balance slightly toward the bull case.
Bullish
- Dominant Data Moat in P&C Insurance: Verisk's proprietary data and regulatory expertise create a high barrier to entry, with 83% of revenue from US-based insurers. This utility-like position generates stable, recurring revenue, as evidenced by consistent gross margins above 67% over the past year.
- Strong Cash Flow Generation: Verisk generates robust free cash flow of $1.127 billion TTM, supporting debt service and capital returns. The FCF yield of approximately 3.6% is modest but stable, providing a cushion for shareholders even amid market volatility.
- Valuation at Historical Discount: The current trailing PE of 34.36x is near the lower end of its 5-year range (17x-130x), and the PS ratio of 10.12x is well below its historical average of around 45x. This suggests the market is pricing in significant disruption fears, potentially creating a value opportunity.
- Analyst Consensus Supports Upside: With a consensus rating of 'buy' and an average target price of $237.12, analysts see a 21.7% upside from the current price of $194.85. The high target of $275 implies a 41.1% upside, reflecting confidence in Verisk's ability to defend its moat.
Bearish
- AI Threat to Data Moat: The primary bear case is that AI could commoditize Verisk's proprietary data, eroding its competitive advantage. This fear has driven the stock down 30% over the past year, despite strong fundamentals, as investors worry about long-term disruption.
- High Leverage and Debt Burden: Verisk's debt-to-equity ratio of 16.30 is extremely high, reflecting significant debt financing. While FCF covers interest expenses, this leverage increases financial risk, especially if cash flows were to decline due to competitive pressures.
- Revenue Growth Deceleration: Revenue growth slowed to 3.9% YoY in Q1 2026, down from higher rates in prior quarters. This deceleration, combined with AI disruption fears, could justify a lower valuation multiple if growth continues to stagnate.
- Negative Relative Strength: Verisk's relative strength over the past year is -48.3% compared to the S&P 500, indicating significant underperformance. This suggests persistent selling pressure and a lack of investor confidence, which could persist if AI concerns remain unresolved.
VRSK Technical Analysis
Key support lies at the 52-week low of $155.94, while resistance is at the 52-week high of $281.82. A breakdown below $155.94 would signal further downside, potentially accelerating the decline, while a breakout above $281.82 would indicate a full recovery, though that seems distant given current trends. The stock's beta of 0.688 suggests it is 31% less volatile than the S&P 500, which could cushion downside but also limit upside in a market rally. The recent price action shows a recovery from the June low of $168.99, but the stock remains well below its February high of $215.58, indicating a fragile rebound.
Beta
0.66
0.66x market volatility
Max Drawdown
-49.1%
Largest decline past year
52-Week Range
$156-$276
Price range past year
Annual Return
-28.4%
Cumulative gain past year
| Period | VRSK Return | S&P 500 |
|---|---|---|
| 1m | -1.3% | +2.8% |
| 3m | +10.4% | +4.2% |
| 6m | +5.9% | +11.3% |
| 1y | -28.4% | +21.5% |
| ytd | -14.1% | +12.7% |
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VRSK Fundamental Analysis
Verisk's balance sheet is highly leveraged, with a debt-to-equity ratio of 16.30, reflecting significant debt financing. However, the company generates robust free cash flow of $1.127 billion on a trailing twelve-month basis, which supports its debt service and capital returns. The current ratio of 1.20 indicates adequate short-term liquidity, and ROE of 2.94% is low due to high equity base, but ROA of 0.19% suggests efficient asset utilization. The company's ability to generate strong cash flow is critical to managing its debt load, and the FCF yield of approximately 3.6% (based on market cap) is modest but stable.
Quarterly Revenue
$782600000.0B
2026-03
Revenue YoY Growth
+3.9%
YoY Comparison
Gross Margin
69.8%
Latest Quarter
Free Cash Flow
$1.1B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is VRSK Overvalued?
Historically, Verisk's PE ratio has ranged from 17x to 130x over the past five years, with the current trailing PE of 34.36x near the lower end of that range. The PS ratio of 10.12x is also below its historical average of around 45x, indicating the stock is trading at a significant discount to its own history. This suggests the market is pricing in a structural decline in growth, possibly due to AI disruption fears. The low valuation relative to history could present a value opportunity if the company can navigate the AI threat, but it also reflects genuine concerns about its long-term competitive position.
PE
34.4x
Latest Quarter
vs. Historical
Low-End
5-Year PE Range 27x~50x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
20.1x
Enterprise Value Multiple
Investment Risk Disclosure
Financial & Operational Risks: Verisk's balance sheet is highly leveraged, with a debt-to-equity ratio of 16.30, indicating substantial debt relative to equity. While the company generates $1.127 billion in free cash flow, this leverage amplifies financial risk, especially if cash flows decline due to competitive pressures or economic downturns. The current ratio of 1.20 suggests adequate short-term liquidity, but the high debt load could constrain future investments or dividend growth. Additionally, revenue growth has decelerated to 3.9% YoY, which, if sustained, could pressure the valuation multiple and reduce the company's ability to service debt comfortably.