S&P Global Inc. (SPGI) receives Old York Operational Quality (AAA) Rating for fiscal year 2025
(AAA) | Financial | Analytics | Ratings
By: Old York Financial
A Private Principal Research Report
the verdict
Old York Financial has assigned S&P Global (SPGI) a Operational Quality (AAA) Rating.
While Moody’s (MCO) is often viewed as the "Crown Jewel" for its pure-play simplicity, S&P Global is the "Global Infrastructure" play. Following the integration of the $44B IHS merger and the 2026 spin-off of its Mobility division, SPGI has transformed into a diversified data machine. It does not just rate debt; it provides the benchmarks (S&P 500) that dictate the movement of trillions of dollars in passive capital.
the old york analysis
owner earnings: the capital-light engine At Old York, we bypass GAAP noise to find the "Spendable Cash" available to a principal owner.
2025 Reported Net Income: $4.47 Billion
(+) Depreciation & Amortization: $1.15 Billion (primarily deal-related amortization)
(–) Maintenance CapEx: ($185 Million)
= OLD YORK OWNER EARNINGS: $5.44 Billion
Analyst Note: Owner Earnings significantly exceed Net Income because SPGI carries massive non-cash amortization from the IHS merger. Like Moody’s, this is a high-margin intellectual property business; it generates nearly $30 in cash for every $1 it spends on "keeping the lights on" (CapEx).
growth & market dominance
Revenue Growth (2025): 8.0% ($15.34 Billion).
5-Year Revenue Avg: ~15.6% (Note: Elevated by the $44B IHS acquisition).
EPS Growth (2025): 19.0% ($14.66).
5-Year EPS Avg: ~12.2%.
Analyst Note: The 19% EPS growth in 2025 proves the scalability of the "Index" and "Ratings" segments. Even as the company prepares to spin off its Mobility division in mid-2026, the core business is showing massive operational leverage—growing profits twice as fast as revenue.
operational efficiency (the "toll bridge" check)
ROIC (Return on Invested Capital): 8.8% (Reported) / ~25% (Cash-Adjusted).
Old York Standard: Sovereign AAA typically requires >15%.
Analyst Note: SPGI’s reported ROIC is artificially suppressed by the "Goodwill" sitting on the balance sheet from acquisitions. If you look at the S&P Dow Jones Indices segment alone, it operates at a 68.8% margin. This is the ultimate toll bridge: they own the "yardstick" (S&P 500) that the entire world uses to measure success.
the fortress check
Pricing Power: SOVEREIGN. S&P Global provides the essential plumbing for global finance. Whether it is a corporation needing a rating to issue debt or an ETF provider needing the S&P 500 name, they have no choice but to pay SPGI’s "tax."
The Analytics Pivot: Subscription-based revenue now accounts for roughly 85% of Market Intelligence and a significant portion of Indices. This recurring revenue stream makes the business resilient even when bond market volatility spikes.
Solvency: Net Debt / Owner Earnings stands at ~1.9x. This is well within the Old York safety limit of 2.0x, especially given the company’s 53-year streak of dividend increases.
final determination
Rating: Old York Sovereign (AAA) Classification: The Global Benchmark. S&P Global is the twin pillar to Moody's. While Moody’s owns the credit opinion, SPGI owns the market index. It is a business that benefits from the "Passive Revolution"—collecting a microscopic fee on trillions of dollars every single day. With the 2026 spin-off of Mobility Global, the company is becoming even leaner and more profitable. It remains a gold-standard principal investment.
Disclaimer: Old York Financial operates privately as a principal and sells corporate advisory. Old York Financial is not an accountant, a financial advisor, a broker, an agent, a lawyer, or a portfolio manager. This report is for informational purposes only.
