Wolfe starts Business and Information Services sector at Market Weight

Wolfe Research analyst Scott Wurtzel initiated coverage of the Business and Information Services sector with a Market Weight rating, identifying S&P Global (SPGI) as the firm’s top pick among the group. Wolfe initiated coverage of S&P Global with an Outperform rating and $453 price target, started Moody’s (MCO) with an Outperform rating and $390 price target and initiated coverage of First Advantage (FA) with an Outperform rating and $17 price target. The analyst also initiated coverage of HireRight (HRT) with a Peer Perform rating and assumed coverage of Sterling Check (STER) with a Peer Perform rating. The firm, which views the Business and Information Services sector as being “moderately exposed to cyclicality,” says its “optimism leans toward companies that have already experienced headwinds,” adding that both S&P and Moody’s experienced notable revenue headwinds over the last 12-18 months as debt issuance volumes were severely challenged. While the background screeners have experienced revenue headwinds as well, the firm remains cautious on the jobs market and believes the recovery in base growth “may not be as straightforward as the ratings revenue recovery,” the analyst tells investors.