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Reasons to Retain TransUnion (TRU) in Your Portfolio Now
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TransUnion (TRU - Free Report) stock has gained 27%, outperforming 21.4% and 25.4% growth of the industry it belongs to and the Zacks S&P 500 Composite in the past year, respectively.
TRU has an expected long-term (three to five years) EPS growth rate of 19.7%. The company’s earnings for 2024 and 2025 are anticipated to grow 10.4% and 18% year over year, respectively. Revenues are expected to increase 4.7% in 2024 and 8.1% in 2025.
Factors That Auger Well
TransUnion’s addressable market is expanding at a rapidly accelerating pace as companies comprehend the importance of building an analytical enterprise, wherein data and insights drive decisions. Numerous underlying trends are supporting this market growth, including the creation of massive amounts of data; technological and analytical advancements that allow data to be processed more rapidly; and growing demand for these business insights across industries and geographies.
TransUnion’s successful acquisition strategy has played a pivotal role in its long-term growth. Acquisition of Verisk Financial in 2022 helps TransUnion offer enhanced insights and solutions that raise financial inclusion, and improve fraud prevention and risk management. Neustar, acquired in 2021, has enabled the company to boost its growth in the U.S. markets and has significantly scaled its standalone margins. This acquisition strategy enables the company to strengthen its competitive position in the market.
TransUnion serves a broad range of customers and maintains strong positions across customers of all sizes. Customer demand remains strong and the company continues to win customers across every vertical. TRU aims to create a long-term competitive advantage by providing the most customer and consumer friendly approach.
Some Risks
TransUnion operates in a highly competitive market. Its competitors widely vary according to its business segment, geographical market, and industry vertical that its solutions address. Its pricing power is being restricted by a high degree of competition and puts a strain on earnings.
TransUnion’s current ratio (a measure of liquidity) has declined both sequentially and year over year. The current ratio in fourth-quarter 2023 was 1.47, lower than the prior quarter’s 1.54 and the year-ago quarter’s 1.6.
Zacks Rank and Stocks to Consider
TransUnion currently carries a Zacks Rank #3 (Hold).
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Reasons to Retain TransUnion (TRU) in Your Portfolio Now
TransUnion (TRU - Free Report) stock has gained 27%, outperforming 21.4% and 25.4% growth of the industry it belongs to and the Zacks S&P 500 Composite in the past year, respectively.
TRU has an expected long-term (three to five years) EPS growth rate of 19.7%. The company’s earnings for 2024 and 2025 are anticipated to grow 10.4% and 18% year over year, respectively. Revenues are expected to increase 4.7% in 2024 and 8.1% in 2025.
Factors That Auger Well
TransUnion’s addressable market is expanding at a rapidly accelerating pace as companies comprehend the importance of building an analytical enterprise, wherein data and insights drive decisions. Numerous underlying trends are supporting this market growth, including the creation of massive amounts of data; technological and analytical advancements that allow data to be processed more rapidly; and growing demand for these business insights across industries and geographies.
TransUnion’s successful acquisition strategy has played a pivotal role in its long-term growth. Acquisition of Verisk Financial in 2022 helps TransUnion offer enhanced insights and solutions that raise financial inclusion, and improve fraud prevention and risk management. Neustar, acquired in 2021, has enabled the company to boost its growth in the U.S. markets and has significantly scaled its standalone margins. This acquisition strategy enables the company to strengthen its competitive position in the market.
TransUnion serves a broad range of customers and maintains strong positions across customers of all sizes. Customer demand remains strong and the company continues to win customers across every vertical. TRU aims to create a long-term competitive advantage by providing the most customer and consumer friendly approach.
Some Risks
TransUnion operates in a highly competitive market. Its competitors widely vary according to its business segment, geographical market, and industry vertical that its solutions address. Its pricing power is being restricted by a high degree of competition and puts a strain on earnings.
TransUnion’s current ratio (a measure of liquidity) has declined both sequentially and year over year. The current ratio in fourth-quarter 2023 was 1.47, lower than the prior quarter’s 1.54 and the year-ago quarter’s 1.6.
Zacks Rank and Stocks to Consider
TransUnion currently carries a Zacks Rank #3 (Hold).
A couple of better-ranked stocks from the broader Zacks Business Services sector are SPX Technologies, Inc. (SPXC - Free Report) and Automatic Data Processing (ADP - Free Report) .
SPX Technologies currently sports a Zacks Rank of 1 (Strong Buy). It has a long-term earnings growth expectation of 18%. You can see the complete list of today’s Zacks #1 Rank stocks here.
SPXC delivered a trailing four-quarter earnings surprise of 23.2%, on average.
Automatic Data Processing currently carries a Zacks Rank of 2 (Buy). It has a long-term earnings growth expectation of 11.6%.
ADP delivered a trailing four-quarter earnings surprise of 2.8%, on average.