After 9 strong months, can RELX continue to crush the FTSE 100 until 2030?

Every investor has stocks they kick themselves for not buying over the years. to me, RELX (LSE: REL) is one of those. I FTSE 100 the stock is up 96% in five years and up 281% in ten years (excluding dividends).

RELX’s performance so far this year? It’s up 16.7%, outpacing the Footsie again.

What it does

With a market capitalization of £67bn, RELX is the UK’s fifth largest listed company. It’s bigger than names in houses like it Lloyds again Rolls-Roycehowever it gets part of the financial story.

Of course, its name is not on the highway banks or the engines that power the planes we fly. So it flies pretty much under the radar, despite being the best performing FTSE 100 stock EVER(!).

What are you doing? Yes, the company provides deeply embedded data analytics services across multiple industries.

It operates in four main categories:

• Science, Technology & Medicine (STM) provides research information for scientists and health professionals. This includes the British medical journal, The Lancet.
• Risk provides data-driven solutions to help banks and insurance companies manage risk and protect against digital fraud.
• Law provides legal research tools, primarily focused on LexisNexis.
• Exhibitions organize trade shows and other major pop culture events in the world.

2024 is going well

Today (October 24), RELX released an encouraging trading update. It reported 7% profit growth in the first nine months of the year, improving in all four categories.

Its show division was the top performer, up 13%, while Risk (now its largest division) grew 8%. Revenue increased 7% in legal and 4% in STM.

For the full year, management expects strong underlying growth in revenue and profits. According to forecasts, we are looking at revenues rising by around 4%-5%, to £9.54bn, and profits growing at a faster pace.

The stock responded well, rising 1% to 3,625p, as I write.

Attractive features

As an investor, I find the company’s diversified markets very attractive. It helps lawyers, doctors, bankers, scientists, and more. This gives it great flexibility for growth.

Meanwhile, an increasing amount of revenue is based on subscriptions and therefore emerges, providing a solid foundation for the business to continue growing until 2030.

I also like that there is a good balance across the income mix, as we see below.

That said, this is a data company, so it could be a target for a cyber attack. Obviously, a security breach can cause reputational damage among customers.

Beyond this risk, the stock is valued at 27 times expected earnings per share in 2025. Any slips in earnings can cause the price to drop significantly.

A data powerhouse

RELX has successfully transitioned from traditional printing to the digital era and is well positioned for the next technological revolution: artificial intelligence (AI).

A company’s large, hard-to-replicate data sets give it a huge competitive advantage. Using machine learning, it can create advanced insights and AI-driven services, allowing its customers to make faster decisions.

For example, its new AI productivity platform (Lexis+ AI) is like a legal-focused version of ChatGPT. It continues to grow in the US and recently launched in international markets.

To me, RELX looks well set to continue beating the FTSE 100 at least until the end of the decade. So, I think it’s finally time for me to buy some stocks!