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With a market cap of $31.4 billion, Equifax Inc. (EFX) is a global data, analytics, and technology company serving businesses, governments, and consumers. Based in Atlanta, Georgia, it provides credit information, workforce solutions, and technology-driven services to diverse industries, including financial services, healthcare, and telecommunications.
Shares of the credit reporting company have underperformed the broader market over the past 52 weeks. EFX stock has surged 20.4% over this time frame, while the broader S&P 500 Index ($SPX) has rallied 31%. In 2024, shares of EFX are up 2.5%, compared to SPX's 25.2% gain on a YTD basis.
In addition, Equifax has also lagged behind the Industrial Select Sector SPDR Fund's (XLI) 34.5% return over the past 52 weeks and 25.1% YTD gain.
Despite reporting better-than-expected Q3 adjusted EPS of $1.85 on Oct. 16, shares of EFX fell 3.3% the next day due to its full-year revenue forecast, which came in below Wall Street's expectation The company's outlook reflected challenges from higher-for-longer interest rates dampening mortgage demand, a key market segment. Additionally, investor sentiment was affected by concerns over the stagnant mortgage market and reliance on non-mortgage revenue growth to offset these headwinds.
For the current fiscal year, ending in December, analysts expect EFX's EPS to grow 8.5% year-over-year to $7.28. The company's earnings surprise history is promising. It beat the consensus estimates in the last four quarters.
Among the 20 analysts covering the stock, the consensus rating is a “Strong Buy.” That’s based on 14 “Strong Buy” ratings, one “Moderate Buy,” and five “Holds.”
On Nov. 20, Stifel analyst Shlomo Rosenbaum reduced Equifax’s price target to $284, maintaining a “Buy” rating on the stock. The adjustment reflects tempered expectations for EBITDA margin expansion in 2025 and slightly lower revenue growth projections due to rising mortgage rates following the U.S. elections.
As of writing, EFX is trading below the mean price target of $315.47. The Street-high price target of $380, implies a potential upside of 49.9% from the current price.
