S&P Global Inc. (SPGI): what the price requires

At today's price, S&P Global Inc. (SPGI) is priced for -4.2% growth. boothcheck doesn't publish a fair value or a price target; it shows what the price assumes, so you can judge whether that bar is too high.

Generated: 2026-07-14 · Exported: 2026-07-16 · Source: https://boothcheck.com/report/SPGI

Headline

FieldValue
TickerSPGI
CompanyS&P Global Inc.
Sector / IndustryFinancial Services
Current price$437.27/sh
CompositionSubscription 51% / Non-subscription / Transaction 21% / Non-transaction 13% / Asset-linked fees 8% / Sales usage-based royalties 3% / Recurring variable 4%

What The Price Requires (Inversion)

The assumption today's price embeds, recovered by inverting the valuation.

FieldValue
Inversion basissegment
Implied growth-4.2%

Solve inputs: computed at a 8.6% cost of capital with 6.6% terminal growth over a 5-year stage; each 1pp of cost of capital moves the implied operating-profit growth ~10.1pp.

How unusual the bet is: within-range (limited comparison data)

ReferenceValue
cohort percentile (of 16 peers)56
implied end-window share0%

Valuation X-Ray

Asset, earnings-power and peer-multiple models all land far below the price; ONLY the growth-DCF reaches it. The bet is durable compounding the static frames structurally cannot price (a moat/durability premium).

How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.

FamilyMedian price/FVModelsReads
Asset2.33x5expensive
Earnings2.87x5expensive
Relative1.36x4expensive
Growth0.90x3justifies

Families that justify the price: Growth Families that call it expensive: Asset, Earnings

The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 8.3%); the inversion above states its own rate.

Per-Model Detail (n=17)

ModelFamilyFVPrice/FVApplicableMethodology
DCF Perpetual GrowthGrowth$485.180.90xyesFCF base $5.9B, growth 8% (input: historical growth), terminal g 4.0%, WACC 8.3%, 6yr projection
DCF Exit MultipleGrowth$484.240.90xyesExit EV/EBITDA: 15.9x / 17.9x / 19.9x (bear / base = today's held flat / bull), 6yr
Relative ValuationRelative$288.481.52xyesP/E 16.57x (blended: static sector reference 12x + trailing (TTM) 27x), scenarios: 13.8x / 16.6x / 19.4x (bear / base = reference held flat / bull), EV/EBITDA N/Ax
Simple DDMGrowth——no—
Two-Stage DDMGrowth——no—
Simple Excess ReturnAsset$173.502.52xyesBV/sh $104.75, ROE (TTM) 15.3%, ke 9.3%
Two-Stage Excess ReturnAsset$220.571.98xyes5yr excess ROE then converge to ke=9.3%
Discounted Future Market CapGrowth$357.291.22xyesRev $15.7B, growth 8% (input: historical growth; tapered), Terminal P/S: 6.6x / 8.0x / 9.4x (bear / base = today's held flat / bull, cap 8x)
Peter Lynch Fair ValueRelative$362.311.21xyesEPS $14.96, growth 24% (input: historical EPS growth), PEG=1.12 (Fair)
Margin TrajectoryGrowth——no—
Earnings Power ValueEarnings$118.213.70xyesNormalized EBIT (5y avg op income, one-time charges added back) $5.23B × (1−21%) / WACC 8.3% → EPV (no growth)
Residual IncomeAsset$225.661.94xyesBV $104.75 + 5yr PV of (ROE (TTM) 15.3% − Kₑ 9.3%) × BV; BV grows 8.8%/yr
Graham NumberAsset$187.762.33xyes√(22.5 × EPS $14.96 × BVPS $104.75) — Graham's conservative floor
EV/EBITDA RelativeRelative——no—
FCF YieldEarnings$152.142.87xyesFCF $5556.0M / Kₑ 9.3% — zero-growth perpetuity
SBC-Adj FCF YieldEarnings$143.863.04xyesSBC-adj FCF $5.33B (FCF $5.56B − SBC $0.23B) capitalized at Kₑ
Ben Graham FormulaEarnings$482.630.91xyesEPS $14.96 × (8.5 + 2×15.0%) × (4.4 / 5.3%)
ROIC-Justified P/BAsset$43.5710.04xyesBV $104.75 × (ROIC 3.4% / WACC 8.3%)
P/Sales SectorRelative$158.572.76xyesRevenue $15.73B × sector P/S 3.0x
PEG Fair ValueRelative$543.460.80xyesEPS $14.96 × (PEG 1.5 × growth 24.2% (input: historical EPS growth)) → PE 36.3x
Earnings YieldEarnings$161.702.70xyesEPS $14.96 / required return 9.3% (Rf 4.3% + ERP 5.0%)
Funds From Operations MultipleRelative——no—
Clinical Phase NPVGrowth——no—
MertonAsset——no—
V5 Mechanical———no—

Solvency

FieldValue
Net debt$14.1b
Net debt / NOPAT (after-tax)2.64x
Net debt / operating income (pre-tax)2.08x
Interest coverage20.6x
Share count CAGR (dilution)1.9%
Burning cashno

Bullet Takeaways

Bull Case

The market is asking S&P Global for roughly 14 to 15% annual operating-profit growth over the next five years; the company just delivered a quarter that makes that ask look ordinary. First-quarter revenue rose 10% to $4.17 billion with growth across every segment, operating margin expanded to 48% from 42%, GAAP diluted EPS jumped 32% to $4.69, and adjusted EPS of $4.97 beat consensus. The priced-in pace sits within what the business has recently delivered, and the multiple itself sits in the lower half of the peer range. For a franchise of this quality, the market is pricing persistence, not acceleration, and persistence is the one thing a ratings-and-benchmarks duopolist actually controls.

The mechanics of the moat are in the filing. Ratings revenue scales with capital-market activity, and the Indices segment grew 14% in 2025 "primarily due to an increase in asset linked fees revenue driven by higher levels of assets under management ('AUM') for ETFs and mutual funds" [FY2025 10-K, accession 0000064040-26-000013]: every dollar that flows into passive investing pays S&P Global a recurring toll on assets it does not manage. Around half of company revenue is subscription-based, anchored by Market Intelligence products where "subscription revenue... is primarily derived from distribution of data, valuation services, analytics, third party research" [FY2025 10-K, accession 0000064040-26-000013], and the Energy segment licenses "proprietary market price data and price assessments to commodity exchanges" [FY2025 10-K, accession 0000064040-26-000013], benchmarks embedded so deeply in contracts that switching is a market-structure event, not a purchasing decision.

The portfolio is also getting cleaner as the numbers improve. The Mobility spin-off completed July 1, 2026, leaving four segments built around data, ratings, benchmarks, and energy information, with pro forma 2025 revenue of $13.6 billion and $13.74 of diluted continuing-operations EPS for the remaining company. Management raised its capital-return commitment to 100% or more of adjusted free cash flow for 2026 through dividends and buybacks. A focused toll-collector compounding revenue high-single-digit organically, expanding margins, and handing back all its free cash is precisely the profile the priced-in growth assumption describes.

Bear Case

Follow the capital-allocation record before admiring the franchise. This is a company that completed the largest merger in its history (IHS Markit) in 2022, sold Engineering Solutions, and has now spun off Mobility in July 2026, four years of assembling and disassembling while the share count over that window drifted up about 1.9% a year, meaning merger dilution has outrun billions of dollars of buybacks. Management now commits to returning 100% or more of adjusted free cash flow, which means repurchasing stock at a price that already embeds roughly mid-teens operating-profit growth for five years. Buying back shares at a demanding multiple is only accretive if the demand is met; if growth mean-reverts toward the roughly 45% historical survival rate for that pace, the buyback becomes a systematic purchase of overpriced equity, funded alongside $14.1 billion of net debt.

The cyclical engine of the recent beat is the part management controls least. The 10-K says it without decoration: issuance-based ratings revenue is "essentially dependent on the number and dollar volume of rated debt securities issued in the capital markets", and "unfavorable financial or economic conditions that either reduce investor demand for rated debt securities or reduce issuers'" willingness to issue cut it directly [FY2025 10-K, accession 0000064040-26-000013]. First-quarter ratings revenue grew 13% on a 14% jump in investment-grade billed issuance; the same arithmetic runs in reverse when refinancing windows close. The index business has the same beta in slower motion, since asset-linked fees track AUM levels [FY2025 10-K, accession 0000064040-26-000013], and AUM is the market itself.

The structural threats are quieter but named in the filing: the "increasing use of AI across our Ratings business subjects Ratings to evolving and potentially complex legal requirements" [FY2025 10-K, accession 0000064040-26-000013], and AI cuts at the data franchise from the demand side too, since language models trained on financial data are a plausible long-run substitute for some Market Intelligence seats. Meanwhile the post-spin company must re-prove its growth algorithm with recast guidance on July 28. Paying 22 times operating income for cyclical-toll revenue at what may be an issuance peak, while management retires stock at that same price, is a bet that this cycle is different, financed by the shareholders themselves.

Valuation

At $430.40 the market pays about 22 times company-wide operating income, which at an 8.6% cost of capital implies operating profit compounding around 14.6% a year for five years. Hold that loosely; the useful part is its context. The pace is within what S&P Global has recently delivered (first-quarter operating margin reached 48% with 10% revenue growth), the multiple sits in the lower half of its peer range, and about 45% of comparable fast-growers historically sustained such a pace for five years. As priced-in assumptions on quality franchises go, this one is demanding but not exotic: a roughly even-odds durability bet on a business built to be durable.

The methods split along exactly the line you would expect for a compounder. The forward-growth lenses land modestly above the price (the price sits about 10% below their central read), because they credit the growth the franchise is currently exhibiting. Every static lens is far below: peer multiples read the price about 35% above what they defend, and earnings-power and asset-based arithmetic sit at roughly a third to half of the price. That pattern is a durability premium: the static methods cannot see the persistence of subscription renewals, ratings duopoly economics, and index fee streams, so the entire gap between their reads and the price is what the market pays for believing those streams persist. The growth-adjusted relative lens leans the same way, reading the price as slightly cheap against growth.

Solvency is unremarkable in the good sense. Net debt of $14.1 billion runs about 2.1 times trailing operating income, interest coverage is 22.6 times, cash generation is strong enough that management guides to returning all of adjusted free cash flow in 2026, and the four-year share-count drift (up about 1.9% a year, a merger-era artifact) is the one blemish on the capital record. The spin-off resets the reporting base: pro forma 2025 revenue for the remaining company is $13.6 billion with $13.74 of continuing-operations diluted EPS. What the price needs is five more years of the ratings-and-indices cycle cooperating with a subscription base that keeps renewing; what it does not need is any balance-sheet rescue.

Catalysts

July 28 is the date that matters. S&P Global reports second-quarter results that morning and will issue its first full-year guidance for the post-spin company; Q2 GAAP results still include Mobility, and from Q3 onward the financials exclude it entirely. The Mobility separation completed July 1, 2026, with Mobility Global trading as MBGL on the NYSE, and the remaining company reorganized into four reportable segments. Recast references: pro forma 2025 revenue of $13.589 billion and diluted continuing-operations EPS of $13.74; pro forma Q1 2026 revenue of $3.717 billion with $4.48 diluted EPS.

The first quarter set a high operating bar: revenue up 10% to $4.17 billion, ratings revenue up 13% on a 14% rise in investment-grade billed issuance, operating margin at 48%, adjusted EPS of $4.97 versus a $4.82 forecast, full-year organic constant-currency revenue growth guidance of 6 to 8%, and adjusted EPS guidance narrowed to $19.40 to $19.65 (a pre-spin frame the July guidance will replace). Issuance volumes are the swing variable between prints; the ratings segment converts them to revenue almost mechanically.

Capital returns escalated: management now expects to return 100% or more of adjusted free cash flow to shareholders in 2026 through dividends and repurchases, up from prior guidance. Buyback pace and any post-spin balance-sheet reset (how much leverage travels with Mobility) are the items to check in the July disclosure.

Peer Cohorts (Per Segment, With Filing Citations)

Market Intelligence / Ratings +2 more (reported)

Commodity Insights (reported)

Methodology Note

Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.

Sources

S&P Global 8-K and press releases, July 2026 · Q1 2026 earnings release, April 2026 · S&P Global recast financials, July 2026 · S&P Global 8-K, July 2026 · S&P Global press releases, July 2026 · Q1 2026 earnings call, April 2026

View the full interactive SPGI report on boothcheck