S&P Global’s strategic evolution positions it as a key player in the $21 trillion private markets ecosystem, earning it a strong buy rating. The company’s focus on becoming the interoperability layer for these markets enhances transparency and value creation, particularly through recent integrations.
Transforming into the Interoperability Layer
S&P Global has shifted from a traditional information provider to a foundational infrastructure for private markets. This change leverages acquisitions like With Intelligence and iLEVEL to standardize transparency in private assets. Such moves build a competitive moat similar to the company’s established dominance in public market ratings.
By enabling seamless data flow and analysis, S&P Global addresses longstanding challenges in private market accessibility, empowering investors with better tools for decision-making.
Key Risks and Built-in Defenses
Despite the opportunities, challenges persist. Artificial intelligence could erode high-margin seat-based revenue streams in the Market Intelligence segment. Additionally, potential regulatory measures might impose pricing caps on services.
However, S&P Global’s revenue model provides robust protection, with 95% derived from proprietary sources. This structure insulates the company from competitive pressures and supports sustained profitability.
Post-Spin-Off Outlook and Price Target
Following the planned Mobility spin-off, S&P Global anticipates margin improvements and a higher valuation multiple. These factors could propel the stock price to $869 by 2029, offering more than 60% upside from current levels.
Investors stand to benefit from this refined focus on core strengths, as the company capitalizes on the growing demand for standardized private market solutions.
