This analysis presents a favorable view of S&P Global Inc. (SPGI), primarily driven by the impending separation of its Mobility division. The Mobility segment, poised to become an independent entity named Mobility Global, Inc. by mid-2026, is depicted as a robust leader in automotive data and analytics. This strategic move is expected to unlock significant value, capitalizing on the segment's high-margin, subscription-based revenue model and its dominant position within the global automotive value chain. The investment thesis suggests that this spin-off will allow for more focused growth and potentially lead to a market re-evaluation of both S&P Global and the newly formed Mobility Global, Inc.
S&P Global Inc. provides a broad range of benchmarks, data, analytics, and workflow solutions across various global markets, including capital, energy, commodities, and automotive sectors. As of February 24th, S&P Global's stock was trading at $418.27, with P/E ratios indicating a healthy financial standing. The company's decision, announced on April 29, 2025, to spin off its Mobility business unit is a pivotal development, aimed at enhancing operational efficiency and market focus.
Mobility Global, Inc. is envisioned as a premier provider of data and analytical infrastructure for the entire automotive ecosystem. Its offerings, including well-known products like CARFAX, automotiveMastermind, Polk Automotive Solutions, and Market Scan, address critical challenges in both new and used vehicle markets. These solutions aim to reduce information asymmetry, boost predictive sales effectiveness, offer comprehensive market measurements, and improve transactional transparency.
A key strength of Mobility Global lies in its diverse product portfolio. CARFAX, for instance, leverages data from over 112,000 sources to serve a vast network of dealerships and millions of consumers, establishing a formidable network effect. automotiveMastermind's predictive Behavior Prediction Score and seamless integration with Dealer Management Systems contribute to high customer retention. Furthermore, Polk's extensive 30-year dataset provides invaluable insights to original equipment manufacturers (OEMs) and marketers, reinforcing Mobility Global's analytical prowess.
The financial prospects of Mobility Global are particularly compelling, characterized by an 81% recurring revenue base and adjusted operating margins of 35.4%. Its asset-light operations require minimal capital, ensuring predictable and high-quality cash flow. The company stands to benefit from several structural growth drivers, including the expanding used vehicle market, strong brand equity that supports pricing power, the increasing adoption of electric vehicles (EVs), deeper penetration of Dealer SaaS, international expansion efforts, and a strategic shift towards higher-margin subscription services.
While the spin-off presents some near-term risks, such as potential operational dis-synergies and management distractions during the transition, the long-term outlook for Mobility Global is highly positive. The company's robust competitive advantages, consistent profit margins, and scalable business model position it as an attractive investment opportunity. These factors suggest significant upside potential for both equity and credit investors, making Mobility Global a compelling bullish case.
The strategic spin-off of S&P Global's Mobility segment is expected to create a dynamic new entity, Mobility Global, Inc., which is well-positioned for substantial growth. With its strong foundation in automotive data and analytics, a highly recurring revenue model, and numerous avenues for expansion, Mobility Global is anticipated to deliver significant returns for investors. This move underscores S&P Global's commitment to optimizing its portfolio and unlocking value in a rapidly evolving market.