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IHS Markit's (INFO) Q4 Earnings Beat Estimates, Increase Y/Y

IHS Markit Ltd. INFO reported mixed fourth-quarter fiscal 2020 results, with earnings beating the Zacks Consensus Estimate but revenues missing the same.

Adjusted earnings per share of 72 cents beat the consensus mark by 7.5% and increased 11% on a year-over-year basis. Total revenues came in at $1.11 billion, marginally missing the consensus mark and declining 1% from the year-ago quarter on a reported basis. Revenues were flat organically.

We observe that shares of IHS Markit have gained 9.7% over the past year against 3.8% decline of the industry it belongs to.

Quarterly Details

Financial services segment’s revenues increased 7% year over year on a reported basis and 6% on an organic basis to $449 million. Revenues at the Resources segment totaled $210 million, down 1% year over year on a reported basis as well as organically.

The Transportation segment witnessed year-over-year revenue decline of 4% on a reported basis to reach $312 million. Revenues increased 2% organically. Revenues at the Consolidated Markets & Solutions segment amounted to $126 million, down 2% year over year on a reported basis. Revenues were flat organically.

Recurring fixed revenues of $809.7 million were down 1% year over year organically. Recurring variable revenues of $158.5 million grew 7% year over year on a reported as well as organic basis. Non-recurring revenues totaled $139 million, down 15% year over year on a reported basis and 11% on an organic basis.

Adjusted EBITDA of $464.9 million was up 3% from the year-ago quarter. Adjusted EBITDA margin improved 160 basis points (bps) year over year to 42%.

IHS Markit Ltd. Price, Consensus and EPS Surprise

IHS Markit Ltd. price-consensus-eps-surprise-chart | IHS Markit Ltd. Quote

IHS Markit ended the quarter with cash and cash equivalent balance of $125.6 million, compared with $156.8 million in the prior quarter. Long-term debt was $4.6 billion compared with $4.7 billion in the previous quarter.

Cash flow from operations and free cash flow amounted to $338.3 million and $275.3 million, respectively, in the quarter. CapEx was $63 million. The company paid out $67.4 million in dividends in the quarter.

Currently, IHS Markit has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank stocks here.

Upcoming Releases

Investors interested in the broader Zacks Business Services sector are keenly awaiting fourth-quarter 2020 earnings reports of key players like Waste Connections WCN, Waste Management WM and Republic Services RSG. While Waste Connections will release earnings on Feb 17, Waste Management and Republic Services will report the same on Feb 18 and Feb 22, respectively.

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