Looking back on data & business process services stocks’ Q2 earnings, we examine this quarter’s best and worst performers, including Verisk (NASDAQ:VRSK) and its peers.
A combination of increasing reliance on data and analytics across various industries and the desire for cost efficiency through outsourcing could mean that companies in this space gain. As functions such as payroll, HR, and credit risk assessment rely on more digitization, key players in the data & business process services industry could be increased demand. On the other hand, the sector faces headwinds from growing regulatory scrutiny on data privacy and security, with laws like GDPR and evolving U.S. regulations potentially limiting data collection and monetization strategies. Additionally, rising cyber threats pose risks to firms handling sensitive personal and financial information, creating outsized headline risk when things go wrong in this area.
The 9 data & business process services stocks we track reported a mixed Q2. As a group, revenues beat analysts’ consensus estimates by 1.6% while next quarter’s revenue guidance was 0.7% below.
While some data & business process services stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 2% since the latest earnings results.
Verisk (NASDAQ:VRSK)
Processing over 2.8 billion insurance transaction records annually through one of the world's largest private databases, Verisk Analytics (NASDAQ:VRSK) provides data, analytics, and technology solutions that help insurance companies assess risk, detect fraud, and make better business decisions.
Verisk reported revenues of $772.6 million, up 7.8% year on year. This print was in line with analysts’ expectations, but overall, it was a mixed quarter for the company with a beat of analysts’ EPS estimates but a miss of analysts’ full-year EPS guidance estimates.
Verisk delivered the weakest performance against analyst estimates of the whole group. Unsurprisingly, the stock is down 10.1% since reporting and currently trades at $264.38.
Is now the time to buy Verisk? Access our full analysis of the earnings results here, it’s free.
Best Q2: CSG (NASDAQ:CSGS)
Powering billions of critical customer interactions annually, CSG Systems (NASDAQ:CSGS) provides cloud-based software platforms that help companies manage customer interactions, process payments, and monetize their services.
CSG reported revenues of $297.1 million, up 2.3% year on year, outperforming analysts’ expectations by 1.9%. The business had a very strong quarter with full-year revenue guidance exceeding analysts’ expectations and a beat of analysts’ EPS estimates.
CSG scored the highest full-year guidance raise among its peers. The market seems content with the results as the stock is up 2.7% since reporting. It currently trades at $64.53.
Is now the time to buy CSG? Access our full analysis of the earnings results here, it’s free.
Slowest Q2: Broadridge (NYSE:BR)
Processing over $10 trillion in equity and fixed income trades daily and managing proxy voting for over 800 million equity positions, Broadridge Financial Solutions (NYSE:BR) provides technology-driven solutions that power investing, governance, and communications for banks, broker-dealers, asset managers, and public companies.
Broadridge reported revenues of $2.07 billion, up 6.2% year on year, in line with analysts’ expectations. It was a slower quarter as it posted revenue guidance for next quarter meeting analysts’ expectations.
The stock is flat since the results and currently trades at $250.02.
Read our full analysis of Broadridge’s results here.
EXL (NASDAQ:EXLS)
Originally founded as an outsourcing company in 1999 before evolving into a technology-focused enterprise, EXL (NASDAQ:EXLS) provides data analytics and AI-powered digital operations solutions that help businesses transform their operations and make better decisions.
EXL reported revenues of $514.5 million, up 14.7% year on year. This number beat analysts’ expectations by 1.6%. It was a strong quarter as it also logged a beat of analysts’ EPS estimates and full-year EPS guidance in line with analysts’ estimates.
The stock is up 3.6% since reporting and currently trades at $43.71.
Read our full, actionable report on EXL here, it’s free.
TransUnion (NYSE:TRU)
One of the three major credit bureaus in the United States alongside Equifax and Experian, TransUnion (NYSE:TRU) is a global information and insights company that provides credit reports, fraud prevention tools, and data analytics to help businesses make decisions and consumers manage their financial health.
TransUnion reported revenues of $1.14 billion, up 9.5% year on year. This print topped analysts’ expectations by 3.7%. Aside from that, it was a mixed quarter as it also logged a beat of analysts’ EPS estimates but full-year EPS guidance in line with analysts’ estimates.
TransUnion pulled off the biggest analyst estimates beat among its peers. The stock is down 8.5% since reporting and currently trades at $86.45.
Read our full, actionable report on TransUnion here, it’s free.
Market Update
Thanks to the Fed’s rate hikes in 2022 and 2023, inflation has been on a steady path downward, easing back toward that 2% sweet spot. Fortunately (miraculously to some), all this tightening didn’t send the economy tumbling into a recession, so here we are, cautiously celebrating a soft landing. The cherry on top? Recent rate cuts (half a point in September 2024, a quarter in November) have propped up markets, especially after Trump’s November win lit a fire under major indices and sent them to all-time highs. However, there’s still plenty to ponder — tariffs, corporate tax cuts, and what 2025 might hold for the economy.
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