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TransUnion (TRU) Stock Up 19.8% in a Year: What's Behind It?
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Shares of TransUnion (TRU - Free Report) have gained 19.8% over the past year, outperforming the 3.5% surge of the industry it belongs to.
Image Source: Zacks Investment Research
Let’s delve into factors that have contributed to the company’s outperformance.
Upbeat 2021 Guidance
TransUnion has raised its guidance for 2021. Revenues are now expected to be between $2.949 billion and $2.992 billion compared with the prior guidance of $2.817-$2.877 billion. The Zacks Consensus Estimate of $2.97 billion lies within the updated guidance.
Adjusted earnings are now expected between $3.45 and $3.58 per share compared with the prior guidance of $3.16-$3.31. The Zacks Consensus Estimate of $3.57 lies within the updated guidance.
Adjusted EBITDA is now anticipated to be between $1.157 billion and $1.189 billion compared with the prior guidance of $1.083-$1.121 billion.
Dividend Hike
On May 12, 2021,TransUnion announced that its board of directors had declared a dividend hike of approximately 27% to 9.5 cents per share. The dividend was paid out to shareholders on Jun 10, as of record date May 26.
Previously, during 2020, 2019 and 2018, TransUnion paid out dividends totaling $57.6 million, $56.8 million and $41.6 million, respectively. Such moves indicate the company’s commitment to create value for shareholders and also underline its confidence in its business. These shareholder-friendly initiatives not only instill investors’ confidence, but also positively impact earnings per share.
Consecutive Earnings & Revenue Beat
TransUnion reported better-than-expected earnings and revenue performance in the last four quarters. While operating efficiency has been aiding the company’s bottom line, strength across segments benefited the top line.
The long-term expected earnings per share (three to five years) growth rate for Interpublic, Equifax and Charles River is 9%, 14% and 15.5%, respectively.
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Image: Bigstock
TransUnion (TRU) Stock Up 19.8% in a Year: What's Behind It?
Shares of TransUnion (TRU - Free Report) have gained 19.8% over the past year, outperforming the 3.5% surge of the industry it belongs to.
Let’s delve into factors that have contributed to the company’s outperformance.
Upbeat 2021 Guidance
TransUnion has raised its guidance for 2021. Revenues are now expected to be between $2.949 billion and $2.992 billion compared with the prior guidance of $2.817-$2.877 billion. The Zacks Consensus Estimate of $2.97 billion lies within the updated guidance.
Adjusted earnings are now expected between $3.45 and $3.58 per share compared with the prior guidance of $3.16-$3.31. The Zacks Consensus Estimate of $3.57 lies within the updated guidance.
Adjusted EBITDA is now anticipated to be between $1.157 billion and $1.189 billion compared with the prior guidance of $1.083-$1.121 billion.
Dividend Hike
On May 12, 2021, TransUnion announced that its board of directors had declared a dividend hike of approximately 27% to 9.5 cents per share. The dividend was paid out to shareholders on Jun 10, as of record date May 26.
Previously, during 2020, 2019 and 2018, TransUnion paid out dividends totaling $57.6 million, $56.8 million and $41.6 million, respectively. Such moves indicate the company’s commitment to create value for shareholders and also underline its confidence in its business. These shareholder-friendly initiatives not only instill investors’ confidence, but also positively impact earnings per share.
Consecutive Earnings & Revenue Beat
TransUnion reported better-than-expected earnings and revenue performance in the last four quarters. While operating efficiency has been aiding the company’s bottom line, strength across segments benefited the top line.
Zacks Rank and Other Stocks to Consider
TransUnion currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Some other top-ranked stocks in the broader Zacks Business Services sector are Interpublic (IPG - Free Report) , Equifax (EFX - Free Report) and Charles River (CRAI - Free Report) , each carrying a Zacks Rank #2 as well.
The long-term expected earnings per share (three to five years) growth rate for Interpublic, Equifax and Charles River is 9%, 14% and 15.5%, respectively.
Zacks' Top Picks to Cash in on Artificial Intelligence
In 2021, this world-changing technology is projected to generate $327.5 billion in revenue. Now Shark Tank star and billionaire investor Mark Cuban says AI will create "the world's first trillionaires." Zacks' urgent special report reveals 3 AI picks investors need to know about today.
See 3 Artificial Intelligence Stocks With Extreme Upside Potential>>