S&P Global Inc. (NYSE:SPGI) has returned 1.41% during the last six months, as of October 15. This compares to a 21.5% return for the Insider Monkey Billionaire Index and 15.74% for the State Street SPDR S&P 500 ETF Trust.
S&P has an advantage that many AI companies would love to have: financial data that customers already pay for and depend on. The company has thus developed a moat which could translate into a long runway. It also has an opportunity to sell more of its data as AI changes how financial institutions use it. Its Q2 earnings call suggests the strategy is gaining traction.
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Its Core Businesses Are Doing the Heavy Lifting
Revenue grew 11% year over year in Q2 2026, while adjusted EPS rose 23%. Operating margins also widened to 54.3%, thanks largely to strong results from Ratings and Indices.
These two divisions account for nearly two-thirds of revenue and more than 80% of operating profit. That’s important because S&P Global isn’t relying on unproven AI products to drive its results. Its established businesses are already generating substantial profits.
Ratings revenue rose 17%, helped by debt issuance tied to AI infrastructure and data centers, as well as mergers and acquisitions. Management also expects approximately $11 trillion in rated debt to come up for refinancing over the next four and a half years. Even if new borrowing slows, refinancing should provide a meaningful source of business.
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AI Is the Next Growth Opportunity
S&P Global is also finding new ways to sell its proprietary data through AI tools. More than 500 customers were using its Kensho AI-ready APIs and connected solutions, and usage increased more than fivefold from Q1 to Q2.
More AI usage is encouraging, but it still has to translate into revenue. Customers are watching their AI costs closely, and some are developing their own tools. S&P Global needs to find ways to charge for the growing use of its data without making it less attractive to customers.
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Is S&P Global Cheap at 19.88x Forward Earnings?
SPGI trades at 24.74x trailing earnings and 19.88x forward earnings. The average forward P/E for Moody’s, MSCI, FactSet, ICE, and Nasdaq is about 20.93x, putting S&P Global slightly below its peer group despite its strong position in ratings and indices.
That gap is interesting. Moody’s and MSCI command higher multiples, while FactSet trades at a much lower one. Investors clearly don’t value every financial data business the same way. Growth prospects, profit margins, and the mix of businesses all play a part, so the peer average is a useful guide, not a measure of what SPGI should be worth.
S&P Global’s ratings and indices businesses are a big part of what makes the company valuable. Banks and investors rely on its credit ratings and benchmarks, and replacing them isn’t easy. Much of the business also brings in recurring revenue, while its high margins mean that even modest sales growth can add meaningfully to earnings.
Still, the stock isn’t an obvious bargain. Ratings and Indices are benefiting from strong issuance and investment flows, while Energy grew just 3% and Market Intelligence grew 6% in the quarter. Some products face weaker demand, and larger customers are taking longer to renew contracts. S&P Global is also planning more than $7 billion in share repurchases this year, which should support earnings per share, although leverage could temporarily rise above its target range.
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Conclusion
At 19.88x forward earnings, SPGI looks reasonably valued, though not cheap enough to be an obvious bargain. The stock could do well if its core businesses keep growing and AI starts contributing meaningfully to revenue. For now, though, that potential still needs to show up in the results. Its discount to peers is worth a closer look, especially for investors willing to be patient. SPGI may not deliver explosive growth, but it could reward shareholders with steady growth over many years.
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Market Sentiment
The number of hedge funds holding SPGI rose to 124 in Q2 2026 from 122 in Q1, according to Insider Monkey’s database. Meanwhile, the combined value of the hedge funds’ positions increased to approximately $15.26 billion from $13.32 billion.
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This article is originally published at Insider Monkey.
