SPGI

The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how S&P Global (NYSE:SPGI) and the rest of the financial exchanges & data stocks fared in Q2. Financial exchanges and data providers operate trading platforms and sell market information. They enjoy relatively stable revenue from trading fees and subscriptions, increasing demand for data analytics, and expansion opportunities in emerging markets. Challenges include regulatory oversight of market structure, competition from alternative trading venues, and substantial technology investments needed to maintain low-latency trading infrastructure and data security. The 10 financial exchanges & data stocks we track reported a satisfactory Q2. As a group, revenues beat analysts’ consensus estimates by 1.6%. Thankfully, share prices of the companies have been resilient as they are up 9% on average since the latest earnings results. Tracing its roots back to 1860 when it published the first railroad industry manual, S&P Global (NYSE:SPGI) provides credit ratings, market intelligence, commodity data, automotive analytics, and financial indices that help investors and businesses make decisions. S&P Global reported revenues of $4.15 billion, up 10.4% year on year. This print exceeded analysts’ expectations by 1%. Despite the top-line beat, it was still a slower quarter for the company with full-year EPS guidance slightly missing analysts’ expectations and a significant miss of analysts’ EPS estimates. The market was likely pricing in the results, and the stock is flat since reporting. It currently trades at $443.98. Read our full report on S&P Global here, it’s free. Founded in 1984 by Joe Mansueto with just $80,000 in personal savings, Morningstar (NASDAQ:MORN) provides independent investment data, research, and analysis tools that help investors, advisors, and institutions make informed financial decisions. Morningstar reported revenues of $663.2 million, up 9.6% year on year, outperforming analysts’ expectations by 2.2%. The business had a very strong quarter with an impressive beat of analysts’ EBITDA estimates and a beat of analysts’ EPS estimates. The market seems happy with the results as the stock is up 5.4% since reporting. It currently trades at $209.40. Is now the time to buy Morningstar? Access our full analysis of the earnings results here, it’s free. Originally known as Morgan Stanley Capital International before becoming independent in 2007, MSCI (NYSE:MSCI) provides critical decision support tools, indexes, and analytics that help global investors understand risk and return factors and build more effective investment portfolios. MSCI reported revenues of $867 million, up 12.2% year on year, in line with analysts’ expectations. It was a mixed quarter due to its lackluster performance in other areas of the business. MSCI delivered the weakest performance against analyst estimates among its peers. As expected, the stock is down 8% since the results and currently trades at $574.94. Read our full analysis of MSCI’s results here. Born from the Chicago Mercantile Exchange founded in 1898 as a butter and egg trading venue, CME Group (NASDAQ:CME) operates the world's largest derivatives marketplace where traders can buy and sell futures and options contracts across interest rates, equities, currencies, commodities, and more. CME Group reported revenues of $1.71 billion, flat year on year. This print surpassed analysts’ expectations by 1.7%. Overall, it was a satisfactory quarter as it also put up a decent beat of analysts’ EBITDA estimates. The stock is up 18.5% since reporting and currently trades at $281.24. Read our full, actionable report on CME Group here, it’s free. Originally founded in 1971 as the world's first electronic stock market, Nasdaq (NASDAQ:NDAQ) operates global exchanges and provides technology, data, and corporate services that help companies, investors, and financial institutions navigate capital markets. Nasdaq reported revenues of $1.5 billion, up 14.9% year on year. This number beat analysts’ expectations by 3%. It was a very strong quarter as it also logged a solid beat of analysts’ EBITDA estimates and a beat of analysts’ EPS estimates. The stock is up 7.3% since reporting and currently trades at $97.50. Read our full, actionable report on Nasdaq here, it’s free. Over the past year, investors have been forced to repeatedly answer the same question: what is the market’s biggest risk? The answer has changed several times, and each shift has reshaped market leadership. Late in 2025 and early 2026, artificial intelligence became the market’s primary uncertainty. Investors questioned whether AI would erode software pricing power and weaken competitive moats as AI made it easier to replicate once-differentiated products. By the spring, technology took a back seat to geopolitics. The U.S. conflict with Iran briefly became the market’s dominant narrative, raising concerns about oil prices, inflation, and global growth. But as energy markets remained orderly and fears of a prolonged supply disruption faded, investors quickly turned their focus back to fundamentals. Want to invest in winners with rock-solid fundamentals? Check out our Strong Momentum Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.

It has been about a month since the last earnings report for S&P Global (SPGI). Shares have added about 4% in that time frame, underperforming the S&P 500. But investors have to be wondering, will the recent positive trend continue leading up to its next earnings release, or is S&P Global due for a pullback? Well, first let's take a quick look at its most recent earnings report in order to get a better handle on the recent catalysts for S&P Global Inc. before we dive into how investors and analysts have reacted as of late. S&P Global reported impressive -quarter 2026 results, with both earnings and revenues beating the Zacks Consensus Estimate. The company's second-quarter 2026 adjusted earnings were $4.83 per share, rising 23% year over year and beating the Zacks Consensus Estimate of $4.49 by 7.6%. Pro-forma revenues of $3.68 billion increased 11% and surpassed the consensus mark of $3.64 billion by 0.8%. The performance was led by record results in Ratings and Indices. Global rated issuance strengthened sharply, with volumes rising 26% in the United States, 12% in Europe and 49% in Asia. Ratings revenues increased 17% year over year to $1.34 billion. Transaction revenues climbed 25% to $746 million, driven by higher debt-rating activity, while non-transaction revenues rose 8% to $593 million. Adjusted operating profit advanced 22% to $917 million. The adjusted operating margin expanded 310 basis points to 68.5%, as revenue growth outpaced a 6% increase in adjusted expenses. Higher compensation and continued investments in strategic initiatives contributed to the expense increase. Indices revenues jumped 20% year over year to $534 million. Growth reflected higher asset-linked fees, supported by increased assets under management and strong trading volumes in exchange-traded derivatives. Asset-linked fees rose 22% to $348 million, while sales usage-based royalties also increased 22% to $99 million. Adjusted operating profit grew 21% to $382 million, and the adjusted operating margin improved 90 basis points to 71.5%. Recurring revenues represented 81.5% of segment revenues compared with 81.9% a year earlier. Adjusted expenses increased 16% due primarily to strategic growth investments and higher compensation costs. Adjusted Energy revenues were $623 million, up 3% year over year. Mid-single-digit growth in Platts, supported by demand for price assessments, was partly offset by muted Global Trading Services volumes and comparatively slower growth in CERA. Recurring revenues accounted for 91.2% of the division’s total, increasing 90 basis points from the prior-year quarter. Adjusted operating profit rose 4% to $296 million, while the adjusted operating margin expanded 70 basis points to 47.5%. Adjusted expenses increased 1%. Higher compensation and investments in growth initiatives were partly offset by productivity measures, helping profit growth remain ahead of the segment’s top-line increase. Adjusted Market Intelligence revenues increased 6% to $1.24 billion. High-single-digit growth in Kensho Data & Platforms, including contributions from With Intelligence, supported the results. Enterprise Solutions delivered low-single-digit growth, including the impacts of the Enterprise Data Management and thinkFolio divestitures. Recurring revenues represented 97% of the segment’s total, up 20 basis points. Adjusted operating profit climbed 10% to $445 million, and the adjusted operating margin expanded 120 basis points to 36%. Adjusted expenses increased 4%, reflecting With Intelligence costs and higher compensation. The divestitures and productivity savings partly offset those pressures. Pro-forma non-GAAP adjusted operating profit increased 15% year over year to $2 billion. Adjusted expenses rose 6% to $1.68 billion, allowing the adjusted operating margin to expand 200 basis points to 54.3%. Adjusted net income increased 19% to $1.43 billion. The adjusted effective tax rate declined to 19.8% from 23.3%, while a 3% reduction in diluted shares outstanding also supported per-share growth. Currency added 3 cents to adjusted earnings. Cash provided by operating activities was $1.44 billion. The adjusted free cash flow, excluding certain items, totaled $1.37 billion, up 1%. The company paid out $287 million in dividends during the quarter. SPGI repurchased $500 million in shares in the second quarter, bringing year-to-date repurchases to $1.5 billion. Management expects total 2026 share repurchases to exceed $7 billion following the Mobility separation. Cash, cash equivalents and restricted cash stood at $4.14 billion at the quarter-end. Short- and long-term debt, excluding $2 billion in bonds transferred to Mobility Global, was $13.17 billion. Adjusted net debt was 1.9 times adjusted EBITDA. S&P Global expects 2026 year-over-year reported revenue growth of 5.9-7.9% excluding Mobility, while the preceding quarter’s Mobility-included figure was 6.3-8.3%. Organic constant-currency revenue growth is projected at 6-8%, with adjusted operating margin expansion of 35-60 basis points (bps) while the first quarter 2026 (Mobility included) view was 10-35 bps. Adjusted diluted earnings are expected to be between $17.5 and $17.75, while the preceding quarter’s (Mobility included) view was $19.4-$19.65. The company projects adjusted corporate unallocated expenses are expected to be $185-$195 million. The preceding quarter’s (Mobility included) view was $220-$230 million. Management reduced net interest expense expectations to $390-$410 million from the $405-$415 million (Mobility included) reported in the preceding quarter. Capital expenditure of $190-$210 million is lowered from the preceding quarter’s (Mobility included) $215-$225 million. Since the earnings release, investors have witnessed a downward trend in estimates revision. The consensus estimate has shifted -6.25% due to these changes. At this time, S&P Global has a subpar Growth Score of D, a score with the same score on the momentum front. Following the exact same course, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for value investors. Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in. Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise S&P Global has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months. S&P Global is part of the Zacks Securities and Exchanges industry. Over the past month, Nasdaq (NDAQ), a stock from the same industry, has gained 4.1%. The company reported its results for the quarter ended June 2026 more than a month ago. Nasdaq reported revenues of $1.5 billion in the last reported quarter, representing a year-over-year change of +14.9%. EPS of $1.07 for the same period compares with $0.85 a year ago. For the current quarter, Nasdaq is expected to post earnings of $1.02 per share, indicating a change of +15.9% from the year-ago quarter. The Zacks Consensus Estimate has changed +0.4% over the last 30 days. Nasdaq has a Zacks Rank #2 (Buy) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of F. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report S&P Global Inc. (SPGI) : Free Stock Analysis Report Nasdaq, Inc. (NDAQ) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Adobe stock trades well below the market on earnings, and the subscription book that has to produce the next set of them is one the company has chosen to grow more slowly. Adobe (ADBE) has lost 24.6% of its value over the trailing twelve months, though the shares have gained 24.7% over the past month. At 15.1 times trailing earnings against 23.3 for the S&P 500, it is priced well below the market it sits in. That multiple is measured against earnings Adobe has already banked. What produces the next round of earnings, however, is an annual recurring revenue pipeline management has intentionally throttled to expand top-of-funnel reach. Twice The Market's Margin, Two-Thirds Its Multiple The quality behind the discount is not in question: roughly twice the market's operating margin, for two-thirds its earnings multiple. On $25.2 billion of revenue over the trailing twelve months, Adobe turns 36.1% into operating profit where the S&P 500 turns 18.4%, and converts 41.6% into operating cash flow where the market converts 21.8%. Turning that much of revenue into cash is the kind of quality the Trefis High Quality Portfolio holds. What the multiple does not tell you is what Adobe is doing to the book behind it. Adobe Is Trading Subscription Growth For Freemium Reach By the company's own account, Adobe has deferred the Creative Cloud price changes it had planned for the second half of fiscal 2026, and is routing new users into free Firefly, Acrobat and Express journeys rather than predominantly into direct-to-paid ones. Management splits the resulting hit to annual recurring revenue about evenly between the deferred price changes and the freemium push. An analyst put that hit at roughly half a billion dollars of organic ARR, and management did not dispute it. The same guidance set the fiscal 2026 ARR growth target at 10.2%, a number that already includes an acquired book of business, even as it raised the full-year revenue and non-GAAP EPS targets on first-half strength and that same acquisition. The reach is showing up: Creative Freemium monthly active users went from 50 million to 90 million year over year, and AI-first ARR tripled to more than $500 million. Turning that reach into revenue is what management says plays out over 2027. What Has To Show Up In Fiscal 2027 The price therefore asks little of the business and a great deal of the plan, and the plan is being run with an interim finance chief in place and the board still searching for the next CEO. Adobe has also shown it can be repriced sharply: it fell 51% in the 2022 inflation shock against a 24% drop for the S&P 500 and 63% in the 2008 financial crisis against 53%, though in the 2020 crash it fell 26% against the index's 34%. What would make 15.1 times earnings worth paying is freemium users converting fast enough that organic ARR growth in fiscal 2027 clears fiscal 2026’s reported 10.2% target—a bar that required the Semrush acquisition to offset deferred price hikes; what would not is monthly active users climbing for another year without the ARR line following. Adobe's five-factor scorecard is the fastest way to see how the pieces of that case score today. Even A Franchise This Profitable Can Make You Wait A payback management puts in 2027 is a long stretch to sit through in one position. The Trefis High Quality Portfolio spreads waiting of that sort across a basket of businesses rather than a single company's timetable. That portfolio has a track record of outpacing the three major indices - the S&P 500, S&P Mid-cap, and Russell 2000.

Its operating margin is a fraction of the market's while its net margin sits above the market's, which is where the earnings comparison stops being about the business. UiPath (PATH) stock has climbed 52.4% over the trailing three months against 4.6% for the S&P 500, and trades at about $15.30 a share. On earnings it looks unremarkable, at 24.4 times against 23.8 for the market. That is the least informative comparison here. Its Earnings Multiple Is Not Measuring Its Operations UiPath runs a 6.0% operating margin against 18.4% for the S&P 500, and yet reports a net margin of 19.6% against the market's 13.1%. Earnings that large do not come out of an operating line that thin: the gap opens up below the operating line, and that is why the earnings multiple looks ordinary. Priced on sales, the premium is plain at 4.8 times against 3.3 for the index, on $1.7 billion of revenue over the trailing twelve months. On operating cash flow the premium is narrower, at 20.8 times against 15.6 for the index. The Sales Premium Is A Bet On Process Orchestration What the company sells has changed. It grew up on deterministic robots that repeat one task the same way every time; what it leads with now is process orchestration, software that sequences agents, automations, systems and people through a whole workflow. Maestro Case, in public preview, pushes that into exception-heavy work with no fixed path, and its UiPath for coding agents product targets what management says nearly every customer conversation surfaces: an automation backlog growing faster than customers can build and maintain. Revenue has grown at an average annual rate of 15.1% over the last three years against 5.9% for the S&P 500. Growth alongside margins earned in the operation is one of the things the Trefis High Quality Portfolio insists on in its holdings, and it is the second half of that pairing that is still missing here. Its Recurring Base Is Compounding Slower Than Its Revenue The counter is in the recurring line. Annual recurring revenue reached $1.901 billion in fiscal Q1 2027, up 12% year over year, while reported revenue grew 17.3%, and ARR rather than the reported line is the rate a subscription platform actually compounds at. Management's answer is that on a trailing twelve-month basis revenue growth is 15% against ARR's 12%. Asked to size the ARR coming from the AI products the case rests on, management said only that it would disclose product ARR periodically. The downside record is part of the counter: the stock fell 75% during the 2022 inflation shock against a 24% drop for the S&P 500, and remains about 65% below its pre-crisis high. What The September Report Has To Show UiPath reports fiscal Q2 2027 results on September 3. Two lines matter most: whether ARR growth closes on revenue growth, and whether GAAP operating income builds on the $28 million posted in fiscal Q1 2027, up from a $16 million operating loss a year earlier. Get both and the premium becomes a claim about the operation rather than the platform story. Miss both, with the operating margin still near 6.0%, and the multiple that made the stock look market-priced goes on measuring something other than the business. Rather than judge that on a single number, a scorecard that grades a company across five factors keeps the whole picture in front of you. One Contested Platform Bet Is A Narrow Way To Own Software Deciding on PATH means picking a side in an argument a single quarter's results will not close. The Trefis High Quality Portfolio takes the other route, holding a group of quality businesses rather than resolving a single company's debate. That portfolio has a track record of outpacing the three major indices - the S&P 500, S&P Mid-cap, and Russell 2000.

The fuel cell maker's earnings multiple is measured on a trailing year, while the guidance management has raised describes a far bigger business. That mismatch moves the buy decision onto delivery rather than demand. Bloom Energy (BE) has returned about 530% over the trailing twelve months and still trades roughly 31% below its 52-week high. At about $237 a share it changes hands at 278 times trailing earnings, against 23.8 for the S&P 500. Whether that gap is a warning or a lag depends on what the trailing figures measure. The Business Changed Faster Than The Trailing Window Bloom sells solid oxide fuel cell systems for on-site power generation. By its own account it took nearly a decade to become the standard supplier to hospitals, factories and university campuses, and less than a year to become one for AI data centers, where every major U.S. hyperscaler and more than a dozen neoclouds, AI labs, and colocation operators have validated its power solutions. Revenue over the trailing twelve months was $3.1 billion, up from $1.6 billion a year earlier, while the second quarter of 2026 alone brought $1.065 billion, up 166% year over year. A multiple measured across that window is priced against quarters that predate the ramp, which is why the raised full-year 2026 outlook matters more: revenue of $3.9 billion to $4.2 billion, and non-GAAP diluted earnings of $2.55 to $2.85 a share. Where The Twenty-Five Billion Actually Sits Most customers never buy the equipment outright. A financier purchases the energy servers and serves the end customer under the contract Bloom originated. Brookfield anchors that financing shelf: the partnership was formed last fall at $5 billion and expanded fivefold in June to $25 billion. That commitment is available project capital rather than an order book. What the trailing year shows is mixed: the business turns 23.7% of revenue into operating cash flow against 21.8% for the market, while its operating margin of 11.2% still trails the market's 18.4%. Holdings in the Trefis High Quality Portfolio tend to be businesses where growth, strong margins and cash generation already sit together. Lumpy Deliveries And A Withdrawn Cash Flow Guide The company flags the fragile part of its model: large campus deliveries are lumpy, and revenue can look concentrated in one or two customers in any single quarter, a concentration management attributes to delivery timing rather than backlog composition. Alongside the raised revenue and operating income outlooks, free cash flow guidance is no longer part of the presentation, a change the CFO described as aligning it with what the company truly guides, while saying conversion from operating income into cash remains strong. Separately, a securities class action covering stock purchases from February 2025 through July 2026 alleges false or misleading statements by the company and certain of its top executives. And when markets have broken this stock has fallen harder: down 78% in the 2020 pandemic crash against 34% for the S&P 500. The options market prices implied volatility at 98, the 15th percentile of its own trailing one-year range: high by most standards, low by this stock's own. At 278 times trailing earnings the price already pays for deliveries landing on schedule and the cash arriving behind them, making this a delivery question rather than a demand one. A slipped campus quarter with no conversion is where the multiple turns from a lag into a warning, and the same five factors on every stock are where both would show. Buy It Or Fear It, How Much Of It Should You Own? Whichever way the call lands, the bigger question is how much of any single stock belongs in a portfolio at all. A position that has grown large enough to matter is worth sizing deliberately rather than by accident. What a position that size would do to your net worth is exactly what the Trefis Wealth team computes, with the same rules-based systematic discipline that runs our High Quality Portfolio. Request a free vulnerability audit of your biggest positions.

Corpay, Inc. CPAY reported impressive second-quarter 2026 results, with earnings and revenues beating the Zacks Consensus Estimate. CPAY reported adjusted earnings per share of $7, rising 36% year over year and surpassing the Zacks Consensus Estimate of $6.60 by 6.1%. Revenues increased 21% to $1.33 billion, beating the consensus mark by 2.6%. Corpay, Inc. price-consensus-eps-surprise-chart | Corpay, Inc. Quote Results benefited from 10% organic revenue growth, led by Corporate Payments. Organic spend climbed 43% to $94.64 billion, while new sales rose 30% and customer retention held at 93%. Corporate Payments revenues jumped 42% year over year to $548.7 million and accounted for 41% of consolidated revenues. On a pro-forma and macro-adjusted basis, segment revenues advanced 16% to $538.1 million. Spend volume surged 70% on a reported basis to $94.64 billion. Pro-forma and macro-adjusted spend increased 43%, reflecting strong customer activity across cross-border and payables. Revenues per spend dollar declined to 0.58% from 0.70%, partly reflecting the addition of larger enterprise clients carrying lower yields. Vehicle Payments revenues increased 13% year over year to $580.2 million, making it Corpay’s largest segment. Pro-forma and macro-adjusted revenues rose 8% to $523.5 million, supported by continued strength in Brazil and Europe. Reported transactions declined 29% to 147.6 million because the prior-year period included activity from the PayByPhone business, which Corpay sold in March 2026. On an adjusted basis, transactions increased 8%, while revenues per transaction were unchanged at $3.56. Lodging Payments revenues rose 3% year over year to $123.2 million. Organic growth was 2%, improving sequentially as the company moved past difficult comparisons created by episodic events in the prior year. Room nights declined 13% to 7.5 million. However, revenues per room night increased 18% to $16.34, helping the segment deliver revenue growth despite lower volume. Management expects Lodging organic growth to accelerate to the mid-single-digit range during the second half. Adjusted EBITDA increased 24% year over year to $767.2 million. The adjusted EBITDA margin expanded 100 basis points to 57.3%, benefiting from operating leverage and favorable macroeconomic conditions. Operating costs rose 9% after excluding foreign exchange movements, acquisitions, stock-based compensation, amortization and a settlement charge. The increase primarily reflected sales investments and modestly higher credit losses. Corpay also recorded a $100-million charge related to a preliminary settlement with the Federal Trade Commission’s Bureau of Consumer Protection. Corpay generated $1.41 billion in net cash from operating activities during the first six months of 2026, up from $1.07 billion in the prior-year period. The company ended June with $3.16 billion in cash and cash equivalents, and $7.00 billion in restricted cash. The leverage ratio stood at 2.55X, while available capacity under the revolving credit facility was $1.6 billion. CPAY repurchased about 1 million shares for $321 million during the quarter and had $1.4 billion remaining under its authorization. Corpay also refinanced its revolving credit facility and Term Loan A. The transaction increased the revolver by about $1 billion to $3.7 billion and included a $1-billion repayment of Term Loan B, extending maturities and improving financial flexibility. For the third quarter, revenues are projected at $1.36 billion at the midpoint, suggesting 16% year-over-year growth, higher than the Zacks Consensus Estimate of $1.31 billion. Adjusted earnings are expected to be $7.15 at the midpoint, hinting at 26% year-over-year growth. It sits higher than the Zacks Consensus Estimate of 6.59. For 2026, Corpay updated its revenue guidance to $5.29-$5.33 billion from the year-ago quarter’s $5.25-$5.33 billion. The consensus estimate meets the midpoint ($5.31 billion) of the guided range. The outlook incorporates the second-quarter outperformance, improved business momentum and favorable macro conditions, partly offset by the planned sale of the Epyx maintenance business. The adjusted earnings guidance is raised to $27.15-$27.55 per share from the year-ago quarter’s view of $26.3-$27.1. The Zacks Consensus Estimate for earnings is pinned at $26.85. The company continues to expect 10% organic revenue growth for the year. Corpay carries a Zacks Rank #3 (Hold) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Insperity, Inc. NSP reported impressive second-quarter 2026 results. NSP reported adjusted earnings of 34 cents per share in the second quarter of 2026, up 31% year over year and surpassing the Zacks Consensus Estimate of 33 cents by 3.0%. Revenues increased 2% to $1.69 billion, beating the consensus mark of $1.67 billion by 0.5%. S&P Global Inc. SPGI registered impressive second-quarter 2026 results. SPGI reported adjusted earnings of $4.83 per share, rising 23% year over year and beating the Zacks Consensus Estimate of $4.49 by 7.6%. Pro-forma revenues of $3.68 billion increased 11% and surpassed the consensus estimate of $3.64 billion by 0.8%. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Corpay, Inc. (CPAY) : Free Stock Analysis Report Insperity, Inc. (NSP) : Free Stock Analysis Report S&P Global Inc. (SPGI) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

A modest earnings premium sits on top of one exceptional margin, and the AI build-out is now pressing on that margin. Microsoft (MSFT) has gained 25% over the past month and is still down 8.3% over the trailing twelve months, which is the sound of a market arguing with itself about one company. At about $487 a share, the stock trades at 27.1 times earnings, against 24.4 for the S&P 500. That is a thin premium, and it is worth being exact about what the premium is buying. Microsoft runs a 47% operating margin, against 18.4% for the S&P 500, on $331.8 billion of revenue over the trailing twelve months. The multiple is being applied to earnings that depend on that margin, so a premium this small stays small only while the margin holds. And the margin is the number the AI build-out is pressing on. Azure and other cloud services grew 43% in fiscal Q4 2026, and the company's own explanation for coming in ahead of expectations is operational rather than visionary: efficiency gains across its CPU and GPU fleet, and process changes that brought new capacity online sooner. Demand still runs ahead of what Microsoft can supply, and closing that gap costs money. Capital spending is guided above $50 billion in fiscal Q1 2027 alone. Gross margin for the company was 67% in fiscal Q4 2026, down year over year on the mix shift toward Azure and the AI infrastructure behind it, and management expects full fiscal 2027 operating margins to fall by less than a point. A business whose growth now leans this heavily on one build-out is a fair reminder of why the Trefis High Quality Portfolio does not depend on the largest technology names for its returns. Three things have to hold, and a fourth is out of management's hands entirely. Azure is guided to roughly 45% constant-currency growth in fiscal Q1 2027, so the growth case is on the record and testable. The operating margin has to survive the capacity bill running through it, and management expects capital expenditure to keep growing year over year in fiscal 2027, so that bill does not stop with the guided year. The shrinking side has to stay small too, and Windows OEM and Devices revenue is guided to fall in the high teens across fiscal 2027. The sharpest objection is a simple one: what protects Microsoft if the industry overbuilds data centers and chips? Management's answer is the shape of that spending: roughly two-thirds of fiscal Q4 2026 capital expenditure went into short-lived CPUs and GPUs, which it can slow down if demand turns. What management cannot slow down is the multiple. In the 2022 inflation shock, the stock fell 32%, against 24% for the S&P 500. A thin premium is not the same as no de-rating risk. Anyone weighing the premium can start with a five-factor scorecard on quality, risk and valuation rather than one ratio. Whichever way the call lands, the bigger question is how much of any single stock belongs in a portfolio at all. How much damage any single position could do to your net worth is a question with a precise answer. The Trefis Wealth team computes it for investors professionally, with the same rules-based systematic discipline that runs our High Quality Portfolio. Request a free vulnerability audit of your biggest positions.

S&P Global (NYSE: SPGI) stock is doing something it rarely does -- it's having a bad year. Since it spun off from McGraw Hill in 2016, it has had only one negative year, 2022, when the stock fell 29%. Over the past 10 years since the spinoff, it has beaten the benchmark that it owns with an average annualized return of 13.8%, compared to 13.6% for the S&P 500. Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue » But it is heading for its second negative year this year, as the stock price is down about 16% as of Aug. 5. A good chunk of that decline has come in the past month, as shares have dropped about 6%. Among the concerns leading up to S&P Global's second-quarter earnings release on July 28 was how the sputtering economy would impact the company, particularly from an interest rate perspective. The July 28-29 meeting of the Federal Open Market Committee (FOMC) supported those concerns. The FOMC kept rates in check at the latest meeting, but there was growing momentum for a rate hike this year, given persistently high inflation rates. Three FOMC members of the 12 dissented on the vote to hold rates at the current range, with all favoring a rate hike. This is not a good omen for S&P Global's ratings business, as higher rates tend to reduce the amount of corporate borrowing and refinancing, which in turn leads to less debt issuance. That can result in a lower amount of new debt for S&P Global to rate, and that can hurt its revenue. But S&P Global also released earnings on July 28, and the results were solid. Revenue increased 10% year over year, but on an adjusted basis, excluding the Mobility business, which S&P spun off as its own company on July 1, it rose 11%. Earnings climbed 18% to $4.12 per share, but excluding the spun-off business, they jumped 23% to $4.83 per share. S&P Global beat revenue and earnings estimates, and two of its business lines, ratings and indexes, had record revenue in the quarter. The results generally supported the idea behind the spinoff, to focus resources and drive revenue in its four main businesses -- ratings, indexes, market intelligence, and energy consulting. The strategy behind spinning off Mobility is in large part to reinforce the moats that S&P Global has built in ratings, indexes, and even market intelligence. The enduring strength of S&P Global is that these businesses are all market leaders, with major competitive advantages. But they are also diverse businesses that balance each other out, with some performing better when others may be down. The latest dip is a great opportunity to buy a great company with multiple moats at a discount. Because it has been such a strong performer, it has always traded at a premium, but the current price-to-earnings ratio of 25 is as low as it's been since 2022, and well below its average P/E ratio of 32. At that value, SPGI's reinforced moats are worth it. Before you buy stock in S&P Global, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and S&P Global wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $400,155!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,345,502!* Now, it’s worth noting Stock Advisor’s total average return is 955% — a market-crushing outperformance compared to 214% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors. See the 10 stocks » *Stock Advisor returns as of August 6, 2026. Dave Kovaleski has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends S&P Global. The Motley Fool has a disclosure policy. S&P Global Trades at 25 Times Earnings After the Post-Earnings Drop. Is the Ratings Moat Worth It? was originally published by The Motley Fool

The chipmaker looks dear on profits and slightly cheap on cash, and what sits under that gap is a business that turns far more of each sales dollar into cash than into profit while it swaps a shrinking handset exposure for faster end markets in data centers and automotive. GlobalFoundries (GFS) stock is down 35% over the past month, and down 23% over the trailing three months against a 3.9% gain for the S&P 500. A fall that size usually leaves a stock cheap. This one is not: at about $50 a share, for a market capitalization near $27.8 billion, it trades at 35.7 times earnings against 23.9 for the S&P 500. On cash flow, the same stock is cheaper than the index. So Why Is It Cheaper Than The Market On Cash Flow? Sales carry a premium too: 4.1 times revenue against 3.4 for the S&P 500. The cash-flow multiple is 14.3 against 15.7 for the index, because the company turns far more of each sales dollar into cash than into profit. Over the trailing twelve months, it converted 28% of revenue into operating cash flow, versus 22% for the market, roughly $1.9 billion on $6.8 billion of sales, while 11.4% of that revenue reached net income. What Have Three Years Actually Done To The Top Line? Shrunk it. Revenue over the trailing twelve months was $6.8 billion, essentially unchanged from a year earlier, and across the last three years it has contracted at a 5.0% average annual rate while the S&P 500 compounded at 5.7%. Profitability sits under the market too: a 12.1% operating margin against 18.4% for the index and an 11.4% net margin against 13.0%. In the first quarter of 2026 the top line grew 3.1% year over year to $1.6 billion, but one quarter is a data point, not a trend. Can The Faster End Markets Outrun The Shrinking Handset Business? The mix shift is what a buyer is paying for. In the first quarter of 2026, communications infrastructure and data centers made up about 14% of the total and grew 32% year over year; automotive, about 23%, grew 24%. The part pulling the other way is bigger: smart mobile devices, about 34% of the total, fell 5% and is guided down a high single-digit percentage across 2026. By the company's own account, silicon photonics should roughly double in 2026 and exit 2028 above a $1 billion run rate, and the 2026 growth outlook for comms and data centers is now a high-30s percentage, up from about 30%. The bear objection is durability, not scale: a 14% slice has to keep compounding at 32% while the largest end market, 34% of the total, is guided down all year, and one analyst asked whether a high-30s pace is a share gain when parts of the AI complex compound at 50% to 100%. What Has A Market Break Cost This Stock Before? Plenty. In the 2022 inflation shock, GFS fell 42% against a 24% drop for the S&P 500, and from its low it took about 47 months to climb back to its pre-crisis high. It is already deep in a hole the market has not shared: the stock sits about 44% below its 52-week high of $89.83, even after a 27% trailing twelve-month return, and the options market prices implied volatility at 77, the 89th percentile of its trailing one-year range. Gross Margin, Design Wins And The Price Adjustments To Watch So what would make the price worth paying? Three things. First, the company's own target: exiting 2026 at or above a 30% gross margin, against about 29% on a non-IFRS basis in the first quarter of 2026 and a guide near 29% for the second quarter of 2026, a quarter that has since closed with results still to report. Working against that target is a roughly half-point quarterly cost headwind from supply chain security. Second, whether the faster end markets lift the three-year top-line rate out of negative territory; the leading indicator is the 50% year-over-year jump in first-quarter 2026 design wins. Third, the price adjustments management says start toward the back end of 2026 and carry into 2027. Get those, and the premium has support; miss them, and what you keep paying is 35.7 times earnings against 23.9 for the market. Rather than settle that on instinct, you can score growth, profitability, risk, and value together with a five-factor buy-or-sell scorecard. The Premium Can Compress While You Wait For The Margin Even if the margin story lands, the multiple can reprice long before the business does, and this stock fell 42% in a downturn that cost the market 24%. Compounding does not require winning that timing argument, only that no single holding decides your result. That is the idea behind the Trefis High Quality portfolio, a rules-based basket built so one position cannot set the outcome. That portfolio has a track record of outpacing a benchmark that combines the three major indices - the S&P 500, S&P Mid-cap, and Russell 2000.