This little -known technology company is now the largest largest business in the FTSE 100

Earl this week, I was looking at the 10 main components of the United Kingdom Ftse 100 index. And one thing jumped – Rex (LSE: REL) It is currently the largest sixth business in the index.

At present, this company under the radar has a market capitalization of £ 77 billion. That means it is bigger than BP, American British tobacco, GSK, Barclays and many other known companies.

So what does this company do? And most importantly, is it worth considering today?

A DATA POWER

RELE is a provider of decision tools and analysis based on information for professional and commercial customers. Its objective is to help customers make better decisions, get better results and be more productive.

Today, the company serves customers in four main areas: risks, scientific, technical and medical, legal and exhibitions. Using more than 36,000 people worldwide, it operates in around 180 countries.

In recent years, the price of RELE shares has increased significantly. And it is easy to see why.

In the coming years, companies will resort more and more to data and analysis to increase productivity. And Rex, who has recently been incorporating artificial intelligence (ai) in his solutions, could be a great beneficiary of this trend.

It is worth noting that their databases currently host more than 40 information petabytes. If the data is the new oil as they say, this company is similar to a gigantic oil well.

It is worth considering?

Should investors consider buying shares today?

Well, there is much to like RELX from an investment perspective.

To start, the company is expected to generate solid growth in the coming years to the back of the data boom. By 2025, it is projected that income and profits per share will increase 7.4% and 11.1%, respectively (that is a higher level of growth than many FTSE 100 companies are generating).

I will point out that the Nick Train portfolio manager, who owns the actions in his Equity Fund in the United Kingdom, said last year that Rel has “Transforming Profit Potential Ahead. “Clearly, he is optimistic here.

Second, the company is very profitable. Between 2019 and 2023, the capital return employee (rubbing) averaged 23%. This is an important metric. Because history shows that companies with high rubbing tend to be good long -term investments.

There is also a growing dividend. This year, it is forecast that payment will grow around 9%. That said, yield is only around 1.7%. So, it is not an action for large income.

In addition, the action has an excellent long -term history. In the last five years, it has risen around 100%. In the last 10 years, it has increased around 250%. There are not many footsie actions with tracking like that.

On the negative side, the assessment is currently quite high. With analysts who expect profits per action of £ 1.33 this year, the ratio to profits (p/e) with a vision of the future is approximately 31.

That is not crazy for a data company. But it does not leave much space for error (such as a slowdown in business growth or an unexpected drop in profits).

Another risk here is the feeling towards technology actions. If this were to deteriorate, we could see some profits.

Given the assessment, I think it could be intelligent to consider waiting for a setback for anyone interested in buying this action. They may not have to wait long: the profits of the whole year are tomorrow (February 13) and could create some volatility.