UL Solutions has had an impressive run over the past six months as its shares have beaten the S&P 500 by 32%. The stock now trades at $71.41, marking a 39.1% gain. This was partly due to its solid quarterly results, and the performance may have investors wondering how to approach the situation.

Is now the time to buy UL Solutions, or should you be careful about including it in your portfolio? See what our analysts have to say in our full research report, it’s free.

Why Is UL Solutions Not Exciting?

We’re glad investors have benefited from the price increase, but we're swiping left on UL Solutions for now. Here are one reason why there are better opportunities than ULS and a stock we'd rather own.

Long-Term Revenue Growth Disappoints

A company’s long-term performance is an indicator of its overall quality. Any business can have short-term success, but a top-tier one grows for years. Regrettably, UL Solutions’s sales grew at a mediocre 4.3% compounded annual growth rate over the last three years. This was below our standard for the business services sector.

Final Judgment

UL Solutions’s business quality ultimately falls short of our standards. With its shares topping the market in recent months, the stock trades at 40.8× forward P/E (or $71.41 per share). This multiple tells us a lot of good news is priced in - you can find more timely opportunities elsewhere. Let us point you toward one of Charlie Munger’s all-time favorite businesses.

High-Quality Stocks for All Market Conditions

The market surged in 2024 and reached record highs after Donald Trump’s presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025.

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