Wolters Kluwer is down 50% from its 52-week high in November 2024.

It’s got massive scale, serving customers in 180 countries, with necessary information and software.

The company is a serial-acquirer in a very fragmented industry with secular tailwinds behind it.

It’s also generating enormous cash flow, with a Free Cash Flow (FCF) to Net Income ratio of over 107%.

But it’s also got some problems:

• Currency headwinds from a strong Euro

• Declines in non-recurring transactional revenues and print media

• Increasing exposure to financing costs and debt

All of that means the stock is down, and the dividend yield is well over 2.5%, with a 5-year Dividend Per Share (DPS) CAGR of over 10%.

Is this industry leader a buy? Let’s find out!

• 📖 Compmany name: Wolters Kluwer N.V.

• ✍️ ISIN: NL0000395903

• 🔎 Ticker: $WKL

• 📚 Type: Dividend Growth Stock

• 📈 Stock Price: €9002

• 💵 Market cap: €20.5 Billion

• 📊 Average daily volume: €74 Million

Onepager

Don’t know Wolters Kluwer?

Here are the basics (click on the picture to expand):

1. Do I understand the business model?

Wolters Kluwer sells software and information services to professionals like lawyers, accountants, and doctors.

Their tools combine expert knowledge with technology to help these professionals make important decisions daily.

They make most of their money from reliable, ongoing subscription payments.

Wolters Kluwer’s combination of expert knowledge, technology, and services is a powerful mix that:

• gives customers actionable information

• helps them automate their workflows

• and ensure compliance with regulations

Revenue Split

Wolters Kluwer generates most of its revenue from the Health and Tax & Accounting divisions.

Here’s the revenue split for 2024:

• Health: €1.6 billion (27% of revenue)

• Tax & Accounting: €1.6 billion (27% of revenue)

• Financial & Corporate Compliance: €1.1 billion (19% of revenue)

• Legal & Regulatory: €0.9 billion (15% of revenue)

• Corporate Performance & ESG: €0.7 billion (12% of revenue)