S&P Global Inc. (SPGI) is scheduled to release its second-quarter 2024 results on Jul 30, before market open. The Zacks Consensus Estimate for revenues is pegged at $3.4 billion, indicating an increase of 10.1% from the year-ago quarter's actual. The top line is expected to have gained primarily from transaction revenues in the Ratings division and subscription revenues across the entire company. The estimate for Ratings revenues is pegged at $866.8 million, suggesting 1.9% growth from the year-ago quarter' ...

Group 1: Sales Forecast and Trends - S&P Global Mobility projects new light vehicle sales volume in July 2024 to reach 1.32 million units, up approximately 1% year over year, translating to an estimated sales pace of 16.4 million units (SAAR), the highest since May 2021 [1][5]. - Despite one less selling day than June 2024, July auto sales volume is expected to match the previous month, with the two-month SAAR level of June and July being similar to April (15.8M) and May (15.9M) [2][5]. - Retail advertised inventory in the US rose by 1.8% compared to May and 57% over last June, indicating a growing inventory trend [2][3]. Group 2: Market Dynamics and Challenges - Mixed signals regarding the second half of the year persist, with new vehicle affordability concerns and expectations that inventories will not advance as strongly as in the past 12 months [2]. - Some automakers are facing challenges in balancing sales, production, inventory, and incentive targets as the market normalizes from the dynamics of 2020-2023 [2]. - The North American light vehicle production outlook for the remainder of the year has been scaled back as automakers manage these factors [2]. Group 3: Battery Electric Vehicle (BEV) Outlook - July BEV share is expected to reach 7.8%, maintaining the previous month's level and showing continued progress from Q1 2024 results [3]. - The introduction of new BEVs such as the Chevrolet Equinox EV and Honda Prologue, along with upcoming models like the Jeep Wagoneer S and Volkswagen ID. Buzz, is anticipated to support BEV share growth in the coming months [3].

Core Insights - S&P Global is positioned well within an oligopoly, benefiting from a strong moat in the debt issuance market, which is crucial for economic activity [1] - The company reported a significant increase in transaction revenue, which rose by 33%, while subscription revenue only grew by 2% to $1.78 billion in Q1 2024 [2] - Operating profits for the Ratings segment increased by 42% from $477 million to $679 million, indicating strong performance despite modest subscription growth [2] - S&P Global's revenue for Q1 2024 reached $3.491 billion, exceeding previous records by over 10%, with operating margins expanding by 350 basis points to 39.7% [5] - Free cash flow (FCF) for Q1 2024 was reported at $851 million, a 74% increase from the prior year, showcasing the company's capital-light business model [6] - The company anticipates a strong Q2 2024 with projected FCF of around $1.2 billion, and plans to return 85% of its FCF to shareholders through dividends and buybacks [8] Segment Performance - The Ratings segment experienced a 29% year-over-year increase, driven by favorable market conditions for debt issuance, particularly in bank loans and high-risk debt [5][12] - Operating profits across segments showed a 21% increase, with expenses rising only by 4%, highlighting operational efficiency [2] - The company is considering selling its Mobility segment, indicating a strategic focus on core revenue-generating areas [1] Market Outlook - S&P Global raised its FY 2024 guidance, reflecting confidence in continued strong performance, particularly in the Ratings segment [5][8] - The company expects lower levels of issuance in the second half of the year, but anticipates robust activity in Q2, supported by strong issuance trends observed in early 2024 [13] - Historical FCF growth has averaged 13.2% annually over the past decade, with expectations for continued growth in the coming years [14] Valuation - S&P Global is currently trading at a forward P/E of 44, which is considered expensive, but the strong free cash flow generation is a key driver of its valuation [4] - A discounted cash flow analysis suggests a fair value just below $570, indicating a potential upside of 17% [14]

Group 1: Company Performance - S&P Global (SPGI) has returned approximately 11.2% since the beginning of the calendar year, outperforming the Business Services sector, which has returned an average of 5.7% year-to-date [2] - The Zacks Consensus Estimate for SPGI's full-year earnings has increased by 0.9% over the past 90 days, indicating improving analyst sentiment and a more positive earnings outlook [5] - S&P Global currently holds a Zacks Rank of 2 (Buy), suggesting a favorable position in terms of earnings estimates and revisions [7] Group 2: Industry Context - S&P Global is part of the Business - Information Services industry, which consists of 10 individual stocks and currently ranks 187 in the Zacks Industry Rank, with an average gain of 9.4% this year [10] - In contrast, ABM Industries, another stock in the Business Services sector, has returned 19.9% year-to-date, indicating strong performance within the sector [8] - The Building Products - Maintenance Service industry, which includes ABM Industries, has seen a year-to-date increase of 14.2% [3]

Development of a new U.S. mine—from discovery to production—takes nearly 29 years, on average NEW YORK, July 18, 2024 /PRNewswire/ -- The United States has the second longest lead times in the world for developing a new mine for the critical minerals that are vital to the energy transition, according to new report by S&P Global.* The report, Mine Development Times: The U.S. in Perspective found that it takes an average of 29 years for such mines to go from discovery to production in the United States, longe ...

Group 1: Strategic Acquisitions and Growth - The company aims to drive growth through strategic acquisitions, innovation, and expansion of content and products [1] - In 2023, the company acquired Market Scan Information Systems, Inc. and ChartIQ, enhancing mobility services and strengthening S&P Global Market Intelligence [1] - The acquisition of Shades of Green in 2022 improved second-party opinions, while the merger with IHS Markit in 2022 enhanced data and analytics offerings [1] Group 2: Financial Performance and Shareholder Returns - S&P Global paid out dividends of $1.1 billion, $1 billion, and $743 million in 2023, 2022, and 2021, respectively [2] - The company repurchased shares worth $3.3 billion in 2023 and $12 billion in 2022, which boosts investor confidence and positively impacts the bottom line [2] Group 3: Liquidity and Financial Ratios - The current ratio at the end of Q1 2024 was 0.92, an increase from 0.84 in the previous quarter and 0.91 a year ago, indicating improved liquidity [3] Group 4: Expense Trends and Future Outlook - Total expenses increased by 3.4%, 99.7%, and 6.4% year over year in 2023, 2022, and 2021, respectively, due to investments in productivity programs and growth initiatives [7] - The bottom line is anticipated to be under pressure in the future due to rising expenses [7] Group 5: Revenue and Earnings Growth Projections - Revenues are expected to grow by 7.7% in 2024 and 7.8% in 2025, while earnings are projected to increase by 12.4% in 2024 and 12.7% in 2025 [10] - The company has a long-term earnings per share growth rate expectation of 12.8% over the next three to five years [10] Group 6: Market Demand and Competitive Position - The company is well-positioned to benefit from the growing demand for business information services, driven by the increasing volume of data from various organizations [11] - The market growth will be fueled by rising demand for news, information, and analytics solutions, with the company continuing to innovate and invest in data technology and workflow tools [11]

Core Insights - The GEP Global Supply Chain Volatility Index indicates that global supply chains are experiencing increased activity, with the index at 0.13, slightly down from May's 14-month high of 0.21, suggesting stretched supply chain capacity for the second consecutive month [3][29]. Supply Chain Activity - Asian manufacturers are leading the growth in supply chain activity, with significant increases in input demand driven by major economies such as China, Taiwan, Vietnam, and India [6][29]. - In contrast, North American suppliers are experiencing fluctuating demand, with a slight decrease in factory input demand in June, although they have generally operated at full capacity since the beginning of 2024 [4][10]. Transportation Costs - Global transportation costs have risen to a 20-month high in June, attributed to increased shipping and container rates due to heightened supply chain activity [7][20]. Demand Trends - Global demand for raw materials, commodities, and components is aligning with long-term averages, indicating a potential upswing in the manufacturing business cycle, particularly in Asia [8][29]. Labor Shortages - Reports of labor shortages among global suppliers are more common than historically typical, indicating a need for capacity expansion to meet current and future demand [9][29]. Regional Insights - The North American index fell to -0.11 from 0.09, indicating slight underutilization, while the U.K. index rose to 0.49, signaling the strongest capacity pressures since January 2023 [10]. - The Asian index increased to 0.35, a 16-month high, reflecting busier supply chains amid strengthening factory activity [10][29]. Inventory Management - The inventory cycle has stabilized, with firms neither excessively building up stocks nor aggressively destocking, suggesting a balanced approach to inventory management [27].

Central European Banks Performance - Elevated interest spreads and strong non-interest income performance drove profitability at three Central European banks, placing them at the top of the performance ranking [1] - Hungary's OTP Bank was ranked as Europe's top-performing bank in 2023, driven by strong lending margins due to higher interest rates [6] - Poland's PKO Bank Polski and Bank Polska Opieki ranked second and third, respectively, benefiting from higher interest rates [6] French Banks Underperformance - France's three largest banks, BNP Paribas, Crédit Agricole, and Société Générale, occupied the bottom three positions in the ranking [4] - Structural issues and regulated savings accounts requiring minimum interest rate payments limited the benefits French banks could derive from higher European Central Bank interest rates [4] European Bank Ranking Methodology - S&P Global Market Intelligence ranked Europe's 50 largest publicly traded banks by assets using seven weighted financial metrics, including return on average equity, net interest margin, and cost-to-income ratio [5] Impact of Central Bank Interest Rates - Banks across Europe benefited from higher central bank interest rates in 2023, aimed at combating high inflation [7] - Hungary's policy interest rate was 13%, and Poland's was 6.75% for much of 2023, enabling banks in these markets to increase earning-asset yields more quickly than funding costs [7] - OTP Bank, PKO Bank Polski, and Bank Pekao had the highest year-end net interest margins among major European lenders at 3.92%, 4.12%, and 4.13%, respectively [7]

Core Insights - The U.S. Property and Casualty (P&C) Insurance Performance Rankings indicate that commercial insurers outperformed personal line carriers in key performance metrics, including earnings and underwriting profitability [1][4] - Kinsale Capital Group Inc. was ranked as the top performing U.S. P&C insurer for the second consecutive year, with a direct premiums written growth of nearly 42.4% and a total volume of $1.57 billion in 2023, marking a 105.2% increase from two years prior [3] - Only two personal lines carriers, Progressive Corp. and Berkshire Hathaway Inc., made it to the top 50 performers, with both companies showing strong performance in their private auto businesses [4] Performance Metrics - The rankings are based on 13 financial metrics from 2023 statutory filings, categorized into six buckets: rates of return, underwriting profitability, balance sheet expansion, investment performance, prior-accident-year reserve development, and premium growth [2] - Specialty commercial lines underwriters benefited from favorable pricing and disciplined underwriting, which were common themes among top performers [4] Company Rankings - The U.S. subsidiary of Arch Capital Group Ltd. secured the second spot in the rankings, while FM Global Group's U.S. subsidiary ranked third [3] - Berkshire Hathaway's overall performance was bolstered by significant net realized capital gains, contributing to its ranking [4]

Core Insights - Nearly 2 million vehicles have returned to U.S. roads after airbag deployments in the last two years, presenting a risk of counterfeit airbags being installed as replacements [6][2] - The National Highway Traffic Safety Administration (NHTSA) warns that counterfeit airbags can lead to severe injuries or fatalities in accidents [7][2] - Consumers are encouraged to check vehicle history reports for airbag deployments and ensure that any replacement airbags are genuine [3][7] Group 1: Vehicle Statistics - Texas has the highest number of vehicles back on the road with 206,000, followed by Florida with 106,000 and North Carolina with 100,000 [1] - Ten states have more than 40,000 vehicles that have been involved in airbag deployments [1] Group 2: Consumer Guidance - Consumers can access free Vehicle History Reports on CARFAX.com to check for airbag deployments in used cars [3] - It is recommended that consumers have a trusted mechanic inspect any replacement airbags before purchasing a used vehicle [3][4] - NHTSA emphasizes the importance of verifying the history of a vehicle and ensuring it has genuine airbag inflators to avoid potential risks [7] Group 3: Industry Context - CARFAX, part of S&P Global Mobility, provides vehicle history information and has the largest vehicle history database [8][5] - S&P Global is recognized as a leading provider of credit ratings and analytics in various markets, including automotive [5]