Verisk Analytics
VRSK
$170.63
+1.64%
Verisk Analytics, Inc. is a leading data, analytics, and technology provider serving the global property-casualty insurance industry, operating within the Industrials sector under Consulting Services. The company holds a dominant market position as an essential, data-driven partner to insurers, providing critical underwriting solutions, claims analytics, and catastrophe modeling that are deeply embedded in the industry's workflows. The current investor narrative is dominated by a significant stock price decline and concerns over growth deceleration, as recent financial results and market reactions suggest heightened scrutiny on the company's revenue trajectory and competitive positioning in a potentially challenging macro environment for its core insurance clients.…
VRSK
Verisk Analytics
$170.63
VRSK 12-Month Price Forecast
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Verisk Analytics's 12-month outlook, with a consensus price target around $221.82 and implied upside of +30.0% versus the current price.
Average Target
$221.82
3 analysts
Implied Upside
+30.0%
vs. current price
Analyst Count
3
covering this stock
Price Range
$137 - $222
Analyst target range
Analyst coverage for Verisk is limited, with only 3 analysts providing estimates, which suggests the stock may have less institutional scrutiny than larger peers, potentially leading to higher volatility. The available data shows consensus estimates for next year's EPS average $10.20, with a range from $9.97 to $10.35, and revenue estimates average $3.80 billion. The implied upside or downside from the current price to an average target cannot be calculated as no average price target is provided in the data. The target range for earnings is relatively tight (a spread of about $0.38), indicating some consensus on near-term profitability, but the lack of price targets limits sentiment analysis. Recent institutional rating actions show a mix of reaffirmations, with firms like RBC Capital and Wells Fargo maintaining 'Outperform' and 'Overweight' ratings as recently as March 2026, while others like Morgan Stanley maintain 'Equal-Weight'. The absence of widespread downgrades amidst the steep price decline suggests some analysts view the sell-off as overdone, but the minimal number of covering analysts overall points to higher uncertainty and less efficient price discovery.
Bulls vs Bears: VRSK Investment Factors
The bear case currently holds stronger evidence, anchored by the severe deceleration in revenue growth from a peak in Q2 2025 and the dramatic compression in gross and net margins observed in the latest quarter. These fundamental deteriorations are the primary drivers of the stock's catastrophic 42.5% annual decline. The bull case rests on the expectation that these are transient issues, with the forward PE of 19x and strong FCF generation providing a valuation floor. The single most important tension in the investment debate is whether the Q4 margin collapse (gross margin down over 1,000 basis points QoQ) is a one-time anomaly or the beginning of a structural decline in the profitability of Verisk's core business model. The resolution of this margin question will determine if the stock is a deep value opportunity or a value trap.
Bullish
- Strong Free Cash Flow Generation: The company generates substantial free cash flow, with TTM FCF of $1.19 billion, providing a solid buffer to service its high debt load and fund operations. This cash generation, alongside an operating cash flow of $343.3 million in Q4 2025, underpins financial stability despite the stock's price collapse.
- Valuation Compression to Forward PE of 19x: The forward PE of 19.12x represents a significant discount from the trailing PE of 34.24x, implying the market expects a substantial earnings recovery. This forward multiple is based on analyst consensus EPS of $10.20, suggesting the stock is pricing in normalized, profitable growth.
- Dominant, Embedded Market Position: Verisk holds a dominant position as an essential data and analytics provider to the global P&C insurance industry, with 83% of revenue from the US. This deep integration into client workflows creates high switching costs and provides a durable, albeit currently challenged, revenue base.
- Analyst Sentiment Holding Steady: Despite the 42.5% annual price decline, key institutional analysts like RBC Capital and Wells Fargo have maintained 'Outperform' and 'Overweight' ratings as recently as March 2026. This suggests some professional investors view the sell-off as an overreaction to near-term headwinds.
Bearish
- Severe Revenue Growth Deceleration: Q4 2025 revenue growth slowed to just 5.87% YoY, a material deceleration from stronger prior quarters. Furthermore, revenue has declined sequentially from a peak of $772.6M in Q2 2025 to $778.8M in Q4 2025, signaling potential saturation or competitive pressure in its core insurance segment.
- Sharp Profitability and Margin Contraction: Q4 2025 net margin compressed to 25.32% from 29.35% in Q3 2025, and gross margin plummeted to 59.60% from 70.13% over the same period. This indicates significant cost pressures or a negative shift in revenue mix, directly threatening the company's premium valuation.
- Extremely High Financial Leverage: The debt-to-equity ratio of 16.30 indicates a highly leveraged capital structure. While strong cash flow provides a cushion, this elevated debt level poses a substantial risk in a higher interest rate environment and limits financial flexibility for strategic moves.
- Catastrophic Technical Breakdown: The stock is in a severe downtrend, down 42.5% over the past year and 26.9% over the past three months, significantly underperforming the S&P 500. The 1-month relative strength of -19.59 shows accelerating selling pressure, driven by company-specific issues rather than broader market weakness.
VRSK Technical Analysis
The stock is in a pronounced and sustained downtrend, with a 1-year price change of -42.52% and a 6-month decline of -32.41%. As of the latest close of $164.28, the price is trading at approximately 10% of its 52-week range ($161.70 to $322.92), positioning it near its absolute lows, which signals extreme bearish sentiment and may represent either a deep value opportunity or a fundamental breakdown. Recent momentum has been severely negative, with the stock down 19.13% over the past month and 26.94% over the past three months, significantly underperforming the S&P 500 (SPY), which was up 0.46% and down 2.1% over the same periods, respectively. This severe underperformance, evidenced by a 1-month relative strength of -19.59, indicates accelerating selling pressure that is diverging sharply from both the longer-term downtrend and the broader market. Key technical support is firmly established at the 52-week low of $161.70, with immediate resistance far above near the 52-week high of $322.92. A breakdown below the $161.70 support level would signal a continuation of the bearish trend, while any recovery would need to overcome significant overhead supply. The stock's beta of 0.819 indicates it has been less volatile than the market during this decline, but the extreme price drop suggests idiosyncratic, company-specific risks are currently the dominant driver of volatility.
Beta
0.82
0.82x market volatility
Max Drawdown
-48.9%
Largest decline past year
52-Week Range
$162-$323
Price range past year
Annual Return
-42.2%
Cumulative gain past year
| Period | VRSK Return | S&P 500 |
|---|---|---|
| 1m | -15.2% | +4.9% |
| 3m | -23.9% | +0.6% |
| 6m | -25.5% | +5.1% |
| 1y | -42.2% | +28.8% |
| ytd | -22.8% | +1.8% |
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VRSK Fundamental Analysis
Revenue growth has decelerated markedly, with Q4 2025 revenue of $778.8 million representing a year-over-year increase of only 5.87%, a significant slowdown from the stronger growth rates seen in prior quarters of 2025 (e.g., Q2 revenue was $772.6 million). The quarterly trend shows revenue peaked in Q2 2025 and has since declined sequentially to Q4, indicating potential headwinds in the core insurance segment, which constitutes 100% of the business. Profitability remains robust but is showing signs of compression; Q4 2025 net income was $197.2 million with a net margin of 25.32%, but this is down from a net income of $225.5 million and a margin of 29.35% in Q3 2025. The gross margin for Q4 2025 was 59.60%, a notable contraction from 70.13% in Q3 2025, suggesting potential cost pressures or a less favorable revenue mix. The balance sheet carries significant financial leverage, with a debt-to-equity ratio of 16.30, indicating a highly leveraged capital structure. However, the company generates substantial cash flow, with trailing twelve-month free cash flow of $1.19 billion and an operating cash flow of $343.3 million in Q4 2025, providing some capacity to service its debt. The current ratio of 1.20 shows adequate short-term liquidity, but the elevated debt level remains a key risk factor in a rising interest rate environment.
Quarterly Revenue
$778800000.0B
2025-12
Revenue YoY Growth
+0.05%
YoY Comparison
Gross Margin
+0.59%
Latest Quarter
Free Cash Flow
$1.2B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is VRSK Overvalued?
Given the company's positive net income, the primary valuation metric is the Price-to-Earnings (PE) ratio. The trailing PE ratio is 34.24x, while the forward PE is significantly lower at 19.12x, indicating the market expects a substantial recovery in earnings growth over the next twelve months. Compared to sector averages, Verisk's trailing PE of 34.24x is difficult to contextualize precisely without a provided industry average, but its forward PE of 19.12x suggests a more normalized earnings-based valuation is anticipated. The significant discount from trailing to forward PE implies the market is pricing in a rebound from recent depressed earnings levels, aligning with analyst EPS estimates averaging $10.20 for the coming period. Historically, the stock's own valuation has compressed dramatically from extreme levels; its current trailing PE of 34.24x is below its recent historical range, which saw figures above 40x as recently as Q3 2025 and even above 100x in early 2024. Trading near the lower end of its own historical valuation band suggests the market has priced in significant pessimism, potentially creating a value scenario if fundamentals stabilize, but it also reflects the material deterioration in growth and margin prospects observed in recent quarters.
PE
34.2x
Latest Quarter
vs. Historical
Low-End
5-Year PE Range 17x~130x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
20.1x
Enterprise Value Multiple
Investment Risk Disclosure
Financial & Operational Risks are pronounced, centered on the company's highly leveraged balance sheet with a debt-to-equity ratio of 16.30. While trailing free cash flow of $1.19 billion provides a serviceability cushion, any sustained margin compression like the Q4 gross margin drop from 70.1% to 59.6% could quickly erode this buffer. Revenue concentration is a critical vulnerability, with 100% of business tied to the property-casualty insurance industry, and recent sequential revenue declines from Q2 to Q4 2025 suggest this core market may be facing headwinds that threaten the growth narrative essential to justifying its valuation.
Market & Competitive Risks are elevated due to valuation compression. The stock's trailing PE of 34.24x, while down from historical highs, remains elevated for a company showing 5.9% revenue growth. If growth does not re-accelerate, this multiple is at risk of further de-rating towards sector averages. The stock's beta of 0.819 indicates it is less volatile than the market, but its 42.5% annual decline demonstrates it carries high idiosyncratic risk from its single-industry exposure. Competitive disruption from insurtech or in-house analytics development by large insurers poses a long-term threat to its moat.
The Worst-Case Scenario involves a continuation of the current negative momentum where revenue growth stalls below 5% and margin compression proves structural rather than cyclical. This could trigger a wave of analyst downgrades from the current steady ratings, leading to a full valuation de-rating. The stock could break its key technical support at the 52-week low of $161.70, potentially revisiting levels implied by a forward PE in the low teens (e.g., 13-15x) on lowered earnings estimates. From the current price of $164.28, a realistic downside in this adverse scenario could be -25% to -30%, targeting a range of $115 to $125, which would align with a forward PE near 12x on the current $10.20 EPS estimate.