S&P Global (SPGI), mcap=$106bn, price $318 vs $386

$SPGI pitch:
– Post-merger S&P Global and IHS Markit – high-quality compounder set to return a significant amount of cashflow to shareholders once IHS Markit integration is complete and synergies are realized.
– Collection of very high-quality businesses with strong historical revenue growth, pricing power, high margins, low capital intensity, and customer stickiness.
– Expected double-digit growth in FCF per share coming from debt boost of incremental borrowings and repurchases of significant amounts of stock.

$SPGI valuation:
– Trades at 4.5% FCF yield.
– Double-digit growth in free cash flow per share is expected going forward.

Exp. gain: Expected to compound at mid-teens.

Full SPGI write-up (free guest account required):

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