EFX recovery continues; TRU executing well
Having recently hosted investor meetings with Equifax, we have greater confidence that the impact of the data breach should ease over time and that the business should ultimately benefit from incremental investments being made over the next two years. The impact of shifting resource from product development to IT transformation does require monitoring though, and litigation remains an overhang. We maintain our Overweight and increase our PT to $140, which requires a 21x PE, one turn higher than at present as Equifax continues to recover from the breach. We also reiterate our Overweight on TransUnion, slightly preferring this stock that has de-rated despite being well set for ongoing execution and earnings beats. Our increased $69 12-month PT requires TRU to maintain its 25x PE.Equifax Inc. is a provider of information solutions and human resources business process outsourcing services for businesses, governments and consumers. The company's services are based on databases of consumer and business information. The company uses statistical techniques, machine learning and proprietary software tools to analyze all available data, creating insights, decision-making solutions and processing services for its clients. The company also provides information, technology and services to support debt collections and recovery management. Additionally, the company provides payroll-related and human resource management business process outsourcing services in the United States of America.
TransUnion is an information and insights company. The company provides consumer reports, actionable insights and analytics such as credit and other scores, and decisioning capabilities to businesses. The company has the following reportable segments: United States Markets, which provides consumer reports, actionable insights and analytics such as credit and other scores, and decisioning capabilities to businesses; International, which provides services similar to its United States Markets segment to businesses in select regions outside the United States; and Consumer Interactive, which provides solutions that help consumers manage their personal finances and take precautions against identity theft.
Formed in 2003 by an established team from Cazenove, one of the most respected investment banks in the UK, Atlantic Equities conducts and publishes fundamental, bottom up research on mid and large cap US companies.
Atlantic provide order execution through a wide range of DMA products and algorithmic trading suites.
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