Is S&P Global Inc (SPGI) overvalued?
On Equity Rank's model estimate, SPGI trades 18% above its fair value. S&P Global Inc (SPGI) last closed at $467.80; the multi-method model fair value is $397.20.
| Price | Model fair value | Price vs model |
|---|---|---|
| $467.80 | $397.20 | 18% above |
What the answer rests on
- 5 of 10 valuation methods put SPGI's value above its price and 5 put it below, so the methods disagree.
- To justify today's price, SPGI's free cash flow would need to grow about 9.6% a year for ten years (a reverse discounted cash flow). Over the last three years it actually grew 29.5% a year.
- SPGI trades at 28.8 times its last year's earnings, against a median of 23.5 for 9 profitable Financial Data & Analytics companies.
- Over the past year the price sat below the model fair value on 11% of trading days. The gap ranged from 6% below to 145% above the model fair value.
Read this before relying on it
The model fair value is an estimate from published financial statements. It is not a forecast of where the price goes, and it can be wrong. Within 10% either side we call it close to fair value: valuation models are not precise enough to read more into a smaller gap. Our own lists have no proven edge over the market yet; the live record shows every result, misses included.
Every valuation method behind SPGI's fair value · What prices assume · Other companies