2 Stocks to Watch From the Booming Business Information Industry

Industry Overview - The Zacks Business – Information Services industry is experiencing increased demand for services that ensure risk mitigation, cost reduction, and productivity improvement due to the work-from-home trend [1] - Companies in this industry are focusing on technology, digital transformation, and data-driven decision-making to identify demand sources and target end markets [2] Current Trends - The industry is witnessing a healthy demand environment, with revenues, income, and operating cash expected to grow during the post-pandemic economic recovery [3] - There is a significant increase in demand for customer-centric solutions, driven by the pandemic, leading companies to modify their business strategies [4] - The adoption of digital transformation, automation, and big data is anticipated to fuel industry growth, with a shift from conventional data solutions to more specialized services [5] Industry Performance - The Zacks Business – Information Services industry holds a Zacks Industry Rank of 109, placing it in the top 45% of 244 Zacks industries, indicating encouraging near-term prospects [6] - Over the past year, the industry has underperformed compared to the S&P 500 Composite, declining by 22% while the S&P 500 rallied by 19.5% [8] Valuation Metrics - The industry is currently trading at a forward 12-month price-to-earnings (P/E) ratio of 19.8X, lower than the S&P 500's 23.36X and the sector's 20.97X [11] Company Highlights - Experian: Achieved 12% total revenue growth at constant currency, including 8% organic revenue growth, demonstrating resilience and strong execution of strategic priorities [15][16] - Intertek: Scaling up its portfolio in high-growth sectors through acquisitions, benefiting from a favorable revenue mix and productivity enhancements [18][19]