Needham analyst Kyle Peterson maintains Equifax Inc EFX with a Buy and raises the price target from $230 to $305.
Kyle Peterson, a discerning analyst at Needham, has crowned Equifax Inc as his Top Pick for 2024, dethroning the erstwhile champion, HireRight Holdings Corp.
After facing pressure in its fundamentals due to a mid-FY22 spike in mortgage rates, Equifax Inc has received a favorable prognosis from Peterson, who anticipates a significant tailwind in 2024 stemming from a recent decline in interest rates.
Beyond the realm of mortgages, Equifax’s non-mortgage businesses have been flourishing, expanding through innovative products, augmented pricing strategies, and an all-time high in growth, promising a fruitful future for the company as outlined by the astute analyst.
Exhibiting a determined evolution, Equifax has reinforced its non-mortgage operations and rationalized its cost structure, engendering robust growth potential even in the face of rising interest rates. With a bolstered core business and an improved mortgage landscape, Peterson expects Equifax to outshine its peers significantly in 2024.
Equifax boasts a compelling data platform encompassing an extensive array of credit, financial, bill payment, employment/income, and demographic data. This wealth of data is packaged and marketed to corporations, government bodies, and individuals, presenting a treasure trove of insights. Of particular note is the company’s workforce solutions segment, setting Equifax apart from its closest competitors – Experian Plc and TransUnion.
Peterson underscores the company’s unique data resources and accelerating organic growth as a favorable opportunity for investors seeking exposure to financial data.
With the shares trading at a P/E multiple of 25x his FY25 estimate, the analyst views the risk-reward proposition as attractive and foresees a positive bias to FY24 numbers as the mortgage headwinds abate.
Based on Peterson’s projections, Q4 revenue and EPS are estimated at $1.31 billion and $1.76 respectively.
Price Action: EFX shares were up by 1.07% at $235.53 as of the last check on Thursday.
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