Equifax (EFX) AI Stock Analysis

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Equifax

(NYSE:EFX)

73Outperform

Equifax demonstrates strong financial performance with robust revenue growth and profitability, driving a high overall score. The earnings call further supports this with positive guidance and strategic initiatives. However, technical analysis indicates caution due to mixed signals, and valuation concerns arise from a high P/E ratio. Despite these challenges, the company's strong fundamentals and strategic outlook help maintain a solid overall score.

Positive Factors

Earnings

Equifax's first quarter results were above consensus expectations, aided by a better-than-expected mortgage market and strong non-mortgage performance.

Growth Opportunities

USIS nonmortgage growth is expected to accelerate to 4%, driven by new product innovation and share gains as benefits from the cloud migration continue to materialize.

Shareholder Returns

The company has announced a $3 billion share repurchase, which is expected to be completed over four years.

Negative Factors

Government Growth

A slowdown in government growth to start the year is disappointing, although there is little evidence to indicate the structural growth opportunity has changed.

Guidance

Full-year guidance fell short of expectations across all key metrics, largely due to a worse-than-expected mortgage outlook, deterioration in hiring trends, and softer verifier government growth expectations.

Mortgage Market

The recent uptick in mortgage rates continues to pressure activity, implying a decline in inquiry volumes in 2025.

Equifax (EFX) vs. S&P 500 (SPY)

Market Cap

$32.56B

Dividend Yield0.59%

Average Volume (3M)1.18M

Price to Earnings (P/E)53.6

Beta (1Y)1.54

Revenue Growth7.12%

EPS Growth9.05%

CountryUS

Employees15,000

SectorIndustrials

Sector Strength80

IndustryConsulting Services

Share Statistics

EPS (TTM)1.53

Shares Outstanding124,199,040

10 Day Avg. Volume1,029,520

30 Day Avg. Volume1,177,840

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)0.00

Price to Cash Flow (P/CF)0.00

P/FCF Ratio0.00

Enterprise Value/Market Cap1.09

Enterprise Value/RevenueN/A

Enterprise Value/Gross Profit11.18

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$285.08

Price Target Upside5.13% Upside

Rating ConsensusStrong Buy

Number of Analyst Covering14

Equifax Business Overview & Revenue Model

Company DescriptionEquifax Inc. (EFX) is a global data, analytics, and technology company that specializes in providing information solutions to businesses, governments, and consumers. Operating primarily in the financial services, automotive, telecommunications, utilities, and retail sectors, Equifax offers a wide range of services including credit reporting, identity verification, fraud detection, and credit risk scoring. The company's core products and services are designed to help clients make informed decisions by leveraging data insights and analytics.

How the Company Makes MoneyEquifax makes money through a diversified revenue model that includes several key streams. The company's primary source of revenue comes from providing credit information and analytics services to businesses, which includes selling credit reports, credit scores, and other financial data products. Equifax also generates revenue through subscription-based services for identity verification and fraud prevention solutions. Additionally, the company earns income from its workforce solutions division, which offers employment and income verification services. Significant partnerships with financial institutions, government agencies, and other enterprises amplify their data offerings and expand their market reach. The company further benefits from its global presence, allowing it to capture revenue from various international markets.

Equifax Key Performance Indicators (KPIs)

Any

Workforce Solutions Revenue Breakdown

Workforce Solutions Revenue Breakdown
Examines revenue from workforce solutions, indicating demand for employment verification and HR services, and reflecting the company's strength in this sector.

Chart InsightsVerification Services have shown a robust recovery since 2022, with recent quarters surpassing pre-2022 highs, reflecting strong demand and strategic positioning. However, Employer Services have faced volatility, with recent declines suggesting potential challenges in client acquisition or retention. Despite these mixed trends, Equifax's earnings call highlights strong overall revenue growth and strategic confidence, underscored by a significant dividend increase and share repurchase program. Yet, economic uncertainties and mortgage market challenges could pose risks to sustaining this momentum.

Data provided by:

Main Street Data

Equifax Financial Statement Overview

Summary

Equifax's financial performance is robust, with strong revenue growth and profitability. The income statement reveals impressive margins and operational efficiency, while the balance sheet shows manageable leverage. Cash flow generation is healthy, supporting the company's operations and growth, although there's a slight decline in free cash flow growth rate.

Income Statement

Very Positive

Equifax has demonstrated consistent revenue growth over the years, with a TTM revenue increase of 9.68% from the previous year. The gross profit margin for TTM stands at an impressive 66.99%, indicating strong cost management and pricing power. The net profit margin is 12.49%, showing solid profitability, though slightly below industry leaders. The EBIT margin of 18.37% and EBITDA margin of 28.50% highlight robust operational efficiency. Overall, the income statement reflects strong growth and profitability, albeit with room for improvement in net margins.

Balance Sheet

Positive

Equifax's balance sheet exhibits a Debt-to-Equity ratio of 0.99, indicating moderate leverage, which is manageable but should be monitored to avoid excessive risk. The Return on Equity for TTM is 14.39%, demonstrating effective use of equity to generate profits. The Equity Ratio stands at 42.03%, showing a stable capital structure with a reasonable level of shareholder equity in the asset base. While there is stability, the balance sheet could benefit from further deleveraging to enhance financial resilience.

Cash Flow

Positive

The cash flow statement reveals a strong Free Cash Flow to Net Income ratio of 1.13, indicating that the company effectively converts net income into cash. The Operating Cash Flow to Net Income ratio is 1.81, underscoring healthy cash generation relative to profits. However, the Free Cash Flow Growth Rate shows a slight decline of 0.50% from the previous year, suggesting a need for vigilance in maintaining cash flow growth. Overall, the cash flow performance is robust, with steady cash generation supporting operations and growth.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
5.68B	5.27B	5.12B	4.92B	4.13B
	Gross Profit
3.16B	2.93B	2.94B	2.94B	2.39B
	EBIT
1.04B	933.60M	1.06B	1.14B	676.60M
	EBITDA
1.72B	1.58B	1.67B	1.58B	1.22B
	Net Income Common Stockholders
604.10M	545.30M	696.20M	744.20M	520.10M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
169.90M	216.80M	285.20M	224.70M	1.68B
	Total Assets
11.76B	12.28B	11.55B	11.04B	9.61B
	Total Debt
5.01B	5.71B	5.79B	5.29B	4.38B
	Net Debt
4.84B	5.49B	5.50B	5.07B	2.69B
	Total Liabilities
6.84B	7.59B	7.57B	7.44B	6.40B
	Stockholders Equity
4.80B	4.53B	3.96B	3.58B	3.17B
Cash Flow		Free Cash Flow
813.00M	515.50M	132.60M	865.80M	524.90M
	Operating Cash Flow
1.32B	1.12B	757.10M	1.33B	946.20M
	Investing Cash Flow
-511.50M	-878.20M	-959.50M	-3.40B	-492.70M
	Financing Cash Flow
-846.40M	-306.20M	273.70M	628.90M	810.80M

Equifax Technical Analysis

Technical Analysis Sentiment

Positive

Last Price271.16

Price Trends

50DMA

241.43

Positive

100DMA

249.39

Positive

200DMA

264.43

Positive

Market Momentum

MACD

8.89

Negative

RSI

69.62

Neutral

STOCH

86.63

Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EFX, the sentiment is Positive. The current price of 271.16 is above the 20-day moving average (MA) of 245.68, above the 50-day MA of 241.43, and above the 200-day MA of 264.43, indicating a bullish trend. The MACD of 8.89 indicates Negative momentum. The RSI at 69.62 is Neutral, neither overbought nor oversold. The STOCH value of 86.63 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for EFX.

Equifax Risk Analysis

Equifax disclosed 29 risk factors in its most recent earnings report. Equifax reported the most risks in the “Tech & Innovation” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Equifax Peers Comparison

Overall Rating

UnderperformOutperform

Sector (64)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EFX	73 Outperform	$32.56B	53.58	12.83%	0.59%	7.12%	9.05%
TRU	72 Outperform	$16.44B	45.32	8.68%	0.51%	8.85%	―
Sector *	64 Neutral	$4.24B	11.64	5.23%	249.83%	4.07%	-10.54%
VRSK	61 Neutral	$41.45B	43.94	475.86%	0.52%	7.47%	59.46%

* Industrials Sector Average

Performance Comparison

EFX

Equifax

271.16

33.38

14.04%

VRSK

Verisk Analytics

307.85

64.30

26.40%

TRU

TransUnion

86.43

8.69

11.18%

Equifax Earnings Call Summary

Earnings Call Date:Apr 22, 2025

(Q1-2025)

% Change Since: 25.95%|

Next Earnings Date:Jul 16, 2025

Earnings Call Sentiment Positive

Equifax demonstrated strong financial performance in the first quarter, surpassing revenue and EPS expectations, and successfully leveraging its cloud transformation. However, significant market uncertainties and challenges in the mortgage market pose risks to future growth.

Q1-2025 Updates

Positive Updates

Strong Revenue Growth

Equifax reported a revenue of $1.442 billion, which is up 4% reported and 5% in constant dollars, exceeding the midpoint of February guidance by $37 million.

Adjusted EPS Exceeds Expectations

Adjusted EPS of $1.53 per share was $0.15 above the midpoint of February guidance, driven by higher revenue growth and improved margins.

Successful Launch of Equifax Cloud

The company successfully transitioned to the Equifax cloud and launched its first-ever Equifax-only solution in the mortgage segment.

International Growth

International revenue increased by almost 7% in constant currency, with strong growth in Latin America, particularly Brazil and Argentina.

New Capital Allocation Plan

Equifax announced a 28% increase in its quarterly dividend and a new $3 billion, four-year share repurchase program.

Negative Updates

Economic and Market Uncertainty

Significant economic and market uncertainty related to tariffs, interest rates, and inflation was highlighted, affecting future guidance.

Challenges in Mortgage Market

The mortgage market remains 50% below normal pre-pandemic levels, with U.S. mortgage revenue comprising 21% of total revenue.

Company Guidance

During the Equifax Q1 2025 earnings call, the company provided guidance for the second quarter and the full year, maintaining its 2025 guidance levels from February despite a strong first-quarter performance. Equifax reported Q1 revenue of $1.442 billion, up 4% reported and 5% in constant dollars, exceeding the midpoint of prior guidance by $37 million. Adjusted EPS was $1.53, $0.15 above the midpoint of February guidance. The company achieved debt leverage of 2.5 turns, aligning with its long-term goal. Equifax expects to generate around $900 million in free cash flow for the year, with a cash conversion rate nearing 95%. For Q2, Equifax anticipates revenue growth of over 5.5% reported and over 6.5% constant currency, with adjusted EPS between $1.85 and $1.95, up more than 4.5% year-over-year. The company also announced a 28% increase in its quarterly dividend to $0.50 per share and a new $3 billion four-year share repurchase program, reflecting confidence in its business model and future free cash flow growth.

Equifax Corporate Events

Executive/Board ChangesShareholder Meetings

Equifax Shareholders Approve Key Decisions at Annual Meeting

Neutral

May 9, 2025

On May 8, 2025, Equifax held its Annual Meeting of Shareholders, where several key decisions were made. Shareholders elected ten directors, approved executive compensation, ratified Ernst & Young LLP as the independent accounting firm, and eliminated supermajority voting requirements in the company’s Articles of Incorporation.

Spark’s Take on EFX Stock

According to Spark, TipRanks’ AI Analyst, EFX is a Outperform.

Equifax demonstrates strong financial performance with robust revenue growth and profitability, driving a high overall score. The earnings call further supports this with positive guidance and strategic initiatives. However, technical analysis indicates caution due to mixed signals, and valuation concerns arise from a high P/E ratio. Despite these challenges, the company’s strong fundamentals and strategic outlook help maintain a solid overall score.

To see Spark’s full report on EFX stock, click here.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.