Verisk Analytics, Inc. (NASDAQ:VRSK) is a highly valued data company among the property-and-casualty insurers. The company supplies the rating forms, catastrophe models, and anti-fraud databases that insurers use to price policies and settle claims, tools they cannot easily build themselves. At about $172 a share and $22 billion in value, it trades near 26 times earnings, down from a high of $248. What you are buying at this price is a near-monopoly toll on one industry, and a bet that its steady, subscription-fed growth keeps compounding.
It is not the only data toll booth being tested, though; see whether the index toll booth at MSCI is unbreakable.
The Toll-Booth Math
Verisk earns its money by selling its data and models mostly by subscription. Insurers pay every year to keep access, and that revenue is remarkably steady. Subscriptions make up 83% of the total and grew about 8% last quarter, while the smaller transaction-based piece fell with quiet weather, leaving organic growth around 6%. The margins are the tell: adjusted operating profit runs near 57% of revenue. Verisk turns that into heavy cash and buys back stock aggressively, repurchasing about $1.9 billion of shares in just the first half of the year. So, at 26 times earnings, you are underwriting that its grip on insurers stays tight enough to keep raising prices and compounding that mid-single-digit growth, even though it now serves a single industry.
Verisk Analytics, Inc. ranked 4th in our list of the 10 Most Profitable Industrial Stocks to Buy Now. To see which stocks outranked it, click HERE.
The Bull Case
To bulls, this is a rare monopoly-like compounder on sale. Verisk’s rating forms and datasets are baked into insurers’ workflows, and even their regulatory filings, so switching away is painful and rare. This is exactly why so much revenue recurs and why it can raise prices steadily. After selling its energy and financial-services arms, it is now a focused, high-margin data franchise that gushes cash and returns it through buybacks and a dividend. Having fallen from $248 to about $172, the premium has already come down, and analysts expect a fair value around $235, roughly a quarter above today’s price.
The Bear Case
The bears say the growth has a ceiling. Verisk now rides on a single industry, so its revenue can only grow about as fast as insurers expand their technology budgets. The largest insurers increasingly build their own analytics in-house, and AI could, over time, make parts of the data and modeling layer cheaper to copy. Rising interest costs from all those buybacks take a toll on the margins, and GAAP earnings actually fell last quarter. At 26 times earnings, the price still assumes smooth compounding, which is why the Street is split, with nearly 40% of the analysts rating it a hold.
Worried about a slowdown? Check out our 10 Best Bear Market Stocks to Invest In Right Now.
The Bottom Line
Is a wide, sticky moat worth 26 times when the growth behind it is maturing and tied to a single industry? That’s the question that needs to be answered. The bulls find the durable subscription engine and pricing power appealing, if insurer tech spending holds up. Meanwhile, the bears see 26 times as reasonable only if the moat keeps compounding. An income investor gets only a small 1.2% dividend. The toll booth is real and rare, yet the market is debating whether a one-industry monopoly deserves a premium as growth slows.
Market Sentiment
According to Insider Monkey’s database, 63 hedge funds held Verisk Analytics, Inc. at the end of the second quarter of 2026, up from 50 the quarter before. The value of those combined holdings also rose, from about $2.1 billion to roughly $2.8 billion.
READ NEXT: Equifax (EFX) vs. TransUnion (TRU): Which Beaten-Down Credit Bureau Is the Better Buy? and Public Storage (PSA) vs. Extra Space (EXR): Which Self-Storage REIT Is the Better Buy?
This article is originally published at Insider Monkey.
