Equifax Inc Stock Intrinsic Value – EQUIFAX INC Reports 4th Quarter Fiscal Year 2022 Earnings Results on February 8, 2023
February 26, 2023
Earnings Overview
On February 8, 2023, EQUIFAX INC ($NYSE:EFX) reported its earnings results for the fourth quarter of fiscal 2022 (ending December 31, 2022), revealing a total revenue of USD 108.2 million, a decrease of 11.4% year-over-year. The company’s net income was reported as USD 1198.0 million, which represented a 4.4% decrease from the same period in the previous year.
Transcripts Simplified
In Q4 2022, Equifax EBITDA margins came in slightly lower than expected at 31%, driven by lower-than-expected margins in Workforce Solutions and International. Capital spending in the fourth quarter was $156 million and is expected to decline in 1Q 2022 to 2023 to about $150 million. Total capital spending in 2023 is expected to be about $545 million. In 2023, the US mortgage market is expected to be substantially below any level seen in the past 10 years, with 1Q 2023 down about 55% year-to-year. USIS is expected to benefit from mortgage shopping behavior with better performance than originations.
Total revenue growth in 2023 is expected to be 4% to the midpoint of the guidance at $5.325 billion. The 30% decline in the US mortgage market is negatively impacting total revenue growth by about 7 percentage points, which is partially offset by non mortgage organic growth exceeding 7% on a constant currency basis. Acquisitions completed in 2022 and year-to-date are expected to contribute about 1% of growth to 2023.
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Equifax Inc. More…
| Total Revenues | Net Income | Net Margin |
| 5.12k | 696.2 | 13.6% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Equifax Inc. More…
| Operations | Investing | Financing |
| 757.1 | -959.5 | 273.7 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Equifax Inc. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 11.55k | 7.57k | 32.3 |
Key Ratios Snapshot
Some of the financial key ratios for Equifax Inc are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 13.5% | 36.4% | 21.7% |
| FCF Margin | ROE | ROA |
| 2.6% | 18.0% | 6.0% |
Price History
The stock opened at $222.5 and closed at $220.2, which was a decrease of 1.2% from the previous closing price of $222.9. An analysis of the company’s results showed that cost control initiatives, including reducing its workforce by 10%, were successful in mitigating some of the losses. Overall, the reports indicates that EQUIFAX INC is doing what it can to remain competitive in a challenging market. With the actions taken in the fourth quarter, the company hopes to improve its performance in the coming year. Live Quote…
Analysis – Equifax Inc Stock Intrinsic Value
At GoodWhale, we have recently conducted an analysis of EQUIFAX INC‘s wellbeing. Through our proprietary Valuation Line, we have calculated EQUIFAX INC’s intrinsic value to be around $222.9. Currently, EQUIFAX INC stocks are being traded at $220.2, which is a fair price, yet undervalued by 1.2%. We believe that EQUIFAX INC is a viable investment option, considering its strong underlying fundamentals and potential for growth. More…
Peers
Equifax Inc. is a credit reporting agency. Its main competitors are TransUnion, Mills Music Trust, and Experian PLC. All three companies compete for credit report customers and business from creditors.
– TransUnion ($NYSE:TRU)
TransUnion is a credit reporting company. It compiles credit information on consumers and businesses, which is used by lenders to make credit decisions. The company also provides other services such as fraud detection, identity theft protection, and credit counseling. TransUnion has a market cap of 10.77B as of 2022, and a Return on Equity of 8.48%.
– Mills Music Trust ($OTCPK:MMTRS)
Mills Music Trust is a publicly traded music royalty company. The company owns the rights to a large catalog of music, which it licenses to businesses and individuals for use in their products and services. Mills Music Trust has a market cap of 10.14M as of 2022. The company generates revenue by licensing its music to businesses and individuals for use in their products and services.
– Experian PLC ($LSE:EXPN)
As of 2022, Experian PLC has a market cap of 24.89B and a Return on Equity of 34.45%. The company is a global information services company that provides data and analytical tools to its clients. Experian helps businesses to manage credit risk, prevent fraud, target marketing offers and automate decision making.
Summary
EQUIFAX INC, a leading consumer credit reporting agency, reported its fourth quarter earnings results for the fiscal year ending December 31, 2022. Total revenue for the quarter was USD 108.2 million, a 11.4% decrease from the same quarter of the previous year. Net income for the period was USD 1198.0 million, a 4.4% decrease from the same period the prior year. From an investor’s perspective, the decrease in net income is a cause of concern, signifying a potential decline in demand and/or market share.
Additionally, an investigation into the underlying cause of the decreased revenue (ie: changes in consumer credit and loan activity, competitive pressures, etc.) may be necessary in order to understand how Equifax may be impacted going forward.
