All the frontier models are converging, using the same internet data as Larry Ellison said months ago. Few people recognize how AI models are unable to provide reliable help on complex tasks because they’re largely trained on the same publicly available internet data. The world is inevitably realizing that AI utility doesn’t come from more compute or fancier models, but instead from proprietary data – despite Sam Altman and Dario Amodei doing their best to keep this fact a secret.

Amidst this landscape, this company holds a key competitive advantage. By continuously leveraging and monetizing its vast proprietary database across all operating segments, it provides highly specialized, comprehensive solutions at scale.

As more firms recognize the importance of specialized high-quality data, this company’s proprietary dataset has even more value and so does its stock.

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This stock presents quality Risk/Reward based on the company’s:

  • competitive advantages borne from proprietary data,
  • profitability near the top of the industry,
  • consistent revenue and profit growth,
  • quality shareholder return backed by strong cash flows,
  • executive compensation plan that is properly aligned with shareholders’ interests, and
  • cheap stock valuation.

Fee Revenue on the Rise

This company leverages its proprietary data and diversified offerings to consistently grow its business.

In fiscal 3Q26 and fiscal 4Q26, the company grew its “new business”, which represents new contracts, not changes in scope on existing contracts, 8% and 4% YoY on a constant currency basis, respectively.

Fiscal 4Q26 represented the company’s fifth consecutive quarter of top line growth, and the company grew fee revenue YoY in four of its five operating segments in the quarter.

The company has a long track record of growing its fee revenue, which illustrates the sustainability and cross selling capabilities of its platform. Total fee revenue grew 10% and 8% compounded annually over the last 5 years and 10 years, respectively.

Figure 1: Total Fee Revenue: Fiscal 2016 – Fiscal 2026

Sources: New Constructs, LLC and company filings

Strong Cash Flow Generation

Importantly, the company’s rising free cash flow (FCF) supports the capital return to shareholders highlighted above.

From fiscal 2021 through fiscal 2026, the company generated $1.3 billion in FCF, which equals 33% of the company’s enterprise value. Over the same time, the company paid out $805 million in dividends and share purchases.

Figure 5: Cumulative Free Cash Flow Since Fiscal 2021

Sources: New Constructs, LLC and company filings

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