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Robust Top Line, Tax Cut to Up TransUnion (TRU) Q2 Earnings
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TransUnion (TRU - Free Report) is slated to release second-quarter 2018 results on Jul 24, before the opening bell.
While we expect the company’s top line to do well on the back of segmental strength, lower U.S tax rates are likely to boost the bottom line.
So far this year, shares of TransUnion have surged 37.1%, significantly outperforming the 18.6% rally of the industry it belongs to.
Let’s check out the expectations in detail.
Strength Across All Segments to Boost Top Line
TransUnion’s operates through three segments — U.S. Information Services (USIS), International and Consumer Interactive. All the segments are expected to report impressive numbers in the to-be-reported quarter.
U.S. Information Services (USIS) revenues are expected to increase year over year, driven by strength across all three platforms — Online Data Services, Marketing Services and Decision Services.
The Zacks Consensus Estimate for Online Data Services revenues is pegged at $214 million, reflecting year-over-year growth of 12%. Strength across innovative products like CreditVision, CreditVision link and TLOXP along with favorable macroeconomic environment should drive the revenues. In the first quarter, Online Data Services revenues increased 25%.
The consensus estimate for Marketing Services stands at $53 million, indicating a year-over-year rise of 13.9%. Demand for digital marketing, new solutions like Creditvision and CreditVision link and growth across Fin Tech customers should push the revenues up. In the first quarter, Marketing Services revenues increased 23%.
The consensus mark for Decision Services revenues stands at $68 million, representing a year-over-year climb of 11.5%. Solid growth across the healthcare business should lead to higher revenues. In the first quarter, Decision Services revenues gained 8%.
Overall, the consensus mark for the USIS segment is estimated at $336 million, depicting a year-over-year improvement of 12.8%. Last reported quarter, the segment grew 21% year over year.
International revenues are likely to be driven by growth across both the developed and emerging markets. The Zacks Consensus Estimate for revenues at this segment is pegged at $99 million, translating into an increase of 13.8%. In the first quarter, revenues at the international segment were up 15% year over year.
The consensus estimate for developed market revenues is pegged at $34.2 million, highlighting 10.4% year-over-year growth. Solid growth across Canada and Hong Kong is expected to boost the developed market revenues. In the first quarter, revenues in the same jumped 12%.
The consensus estimate for emerging market revenues stands at $64 million, reflecting an increase of 14.3% year over year. Strong growth in India as well as the other key markets is expected to boost the emerging market top line. In the first quarter, emerging market revenues increased 17%.
Consumer Interactive revenues are expected to be driven by growth in both direct and indirect channels. The Zacks Consensus Estimate for this segment’s revenues is pegged at $115 million, reflecting year-over-year growth of 9.5%. In the first quarter, the segment grew 12% year over year.
Solid segmental rise is expected to contribute significantly to year-over-year growth of TransUnion’s total revenues. The Zacks Consensus Estimate for the same is currently pegged at $539.45 million, representing 13.6% year-over-year increase. Notably, the consensus estimate is above the higher end of the company’s guided revenue range of $534-$539 million for second-quarter 2018. The guidance shows an improvement of 12-13% year over year on a constant-currency basis.In first-quarter 2018, total revenues rose 18% year over year.
The Tax Cuts and Jobs Act, which reduced corporate tax rates substantially from 35% to 21%, is expected to benefit TransUnion’s earnings in the to-be-reported quarter. The company expects second-quarter adjusted earnings per share (EPS) to gain around 7 cents from the tax cut.
The Zacks Consensus Estimate for the same is pegged at 60 cents, reflecting year-over-year growth of 27.7%. Notably, the consensus estimate meets the higher end of the company’s guided EPS range of 59-60 cents for second-quarter 2018. The guidance shows an improvement of 26-29% year over year. In first-quarter 2018, adjusted earnings surged 36% year over year to 57 cents.
Our Model Suggests a Beat
Per the Zacks model, a company with a favorable Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) has a good chance of beating estimates if it also has a positive Earnings ESP. The Sell-rated stocks (Zacks Rank #4 or 5) are best avoided, especially if they have a negative Earnings ESP. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
TransUnion has an Earnings ESP of +1.47% and a Zacks Rank #3, a combination that increases the odds of an earnings beat.
Other Stocks to Consider
Here are a few other stocks from the broader Business Services sector that investors may consider, as our model shows that these too have the right combination of elements to beat on earnings in second-quarter 2018:
IQVIA Holdings (IQV - Free Report) has an Earnings ESP of +0.25% and a Zacks Rank #2. The company is slated to report quarterly results on Jul 24.
Aptiv (APTV - Free Report) has an Earnings ESP of +0.08% and a Zacks Rank of 3. The company is slated to report quarterly numbers on Jul 31.
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Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
Image: Bigstock
Robust Top Line, Tax Cut to Up TransUnion (TRU) Q2 Earnings
TransUnion (TRU - Free Report) is slated to release second-quarter 2018 results on Jul 24, before the opening bell.
While we expect the company’s top line to do well on the back of segmental strength, lower U.S tax rates are likely to boost the bottom line.
So far this year, shares of TransUnion have surged 37.1%, significantly outperforming the 18.6% rally of the industry it belongs to.
Let’s check out the expectations in detail.
Strength Across All Segments to Boost Top Line
TransUnion’s operates through three segments — U.S. Information Services (USIS), International and Consumer Interactive. All the segments are expected to report impressive numbers in the to-be-reported quarter.
U.S. Information Services (USIS) revenues are expected to increase year over year, driven by strength across all three platforms — Online Data Services, Marketing Services and Decision Services.
The Zacks Consensus Estimate for Online Data Services revenues is pegged at $214 million, reflecting year-over-year growth of 12%. Strength across innovative products like CreditVision, CreditVision link and TLOXP along with favorable macroeconomic environment should drive the revenues. In the first quarter, Online Data Services revenues increased 25%.
The consensus estimate for Marketing Services stands at $53 million, indicating a year-over-year rise of 13.9%. Demand for digital marketing, new solutions like Creditvision and CreditVision link and growth across Fin Tech customers should push the revenues up. In the first quarter, Marketing Services revenues increased 23%.
The consensus mark for Decision Services revenues stands at $68 million, representing a year-over-year climb of 11.5%. Solid growth across the healthcare business should lead to higher revenues. In the first quarter, Decision Services revenues gained 8%.
Overall, the consensus mark for the USIS segment is estimated at $336 million, depicting a year-over-year improvement of 12.8%. Last reported quarter, the segment grew 21% year over year.
International revenues are likely to be driven by growth across both the developed and emerging markets. The Zacks Consensus Estimate for revenues at this segment is pegged at $99 million, translating into an increase of 13.8%. In the first quarter, revenues at the international segment were up 15% year over year.
The consensus estimate for developed market revenues is pegged at $34.2 million, highlighting 10.4% year-over-year growth. Solid growth across Canada and Hong Kong is expected to boost the developed market revenues. In the first quarter, revenues in the same jumped 12%.
The consensus estimate for emerging market revenues stands at $64 million, reflecting an increase of 14.3% year over year. Strong growth in India as well as the other key markets is expected to boost the emerging market top line. In the first quarter, emerging market revenues increased 17%.
Consumer Interactive revenues are expected to be driven by growth in both direct and indirect channels. The Zacks Consensus Estimate for this segment’s revenues is pegged at $115 million, reflecting year-over-year growth of 9.5%. In the first quarter, the segment grew 12% year over year.
Solid segmental rise is expected to contribute significantly to year-over-year growth of TransUnion’s total revenues. The Zacks Consensus Estimate for the same is currently pegged at $539.45 million, representing 13.6% year-over-year increase. Notably, the consensus estimate is above the higher end of the company’s guided revenue range of $534-$539 million for second-quarter 2018. The guidance shows an improvement of 12-13% year over year on a constant-currency basis.In first-quarter 2018, total revenues rose 18% year over year.
TransUnion Revenue (TTM)
TransUnion Revenue (TTM) | TransUnion Quote
Tax Cut to Drive the Bottom Line
The Tax Cuts and Jobs Act, which reduced corporate tax rates substantially from 35% to 21%, is expected to benefit TransUnion’s earnings in the to-be-reported quarter. The company expects second-quarter adjusted earnings per share (EPS) to gain around 7 cents from the tax cut.
The Zacks Consensus Estimate for the same is pegged at 60 cents, reflecting year-over-year growth of 27.7%. Notably, the consensus estimate meets the higher end of the company’s guided EPS range of 59-60 cents for second-quarter 2018. The guidance shows an improvement of 26-29% year over year. In first-quarter 2018, adjusted earnings surged 36% year over year to 57 cents.
Our Model Suggests a Beat
Per the Zacks model, a company with a favorable Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) has a good chance of beating estimates if it also has a positive Earnings ESP. The Sell-rated stocks (Zacks Rank #4 or 5) are best avoided, especially if they have a negative Earnings ESP. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
TransUnion has an Earnings ESP of +1.47% and a Zacks Rank #3, a combination that increases the odds of an earnings beat.
Other Stocks to Consider
Here are a few other stocks from the broader Business Services sector that investors may consider, as our model shows that these too have the right combination of elements to beat on earnings in second-quarter 2018:
Avis Budget Group (CAR - Free Report) has an Earnings ESP of +5.17% and a Zacks Rank of 1. The company is scheduled to report quarterly numbers on Aug 7. You can see the complete list of today’s Zacks #1 Rank stocks here.
IQVIA Holdings (IQV - Free Report) has an Earnings ESP of +0.25% and a Zacks Rank #2. The company is slated to report quarterly results on Jul 24.
Aptiv (APTV - Free Report) has an Earnings ESP of +0.08% and a Zacks Rank of 3. The company is slated to report quarterly numbers on Jul 31.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
It's not the one you think.
See This Ticker Free >>