Have you assessed how the international operations of Equifax (EFX Quick QuoteEFX - Free Report) performed in the quarter ended December 2024? For this credit reporting company, possessing an expansive global footprint, parsing the trends of international revenues could be critical to gauge its financial resilience and growth prospects.

In today's increasingly interconnected global economy, a company's ability to tap into international markets can be a pivotal factor in shaping its overall financial health and growth trajectory. For investors, understanding a company's reliance on overseas markets has become increasingly crucial, as it offers insights into the company's sustainability of earnings, ability to tap into diverse economic cycles and overall growth potential.

Being present in foreign markets serves as protection against local economic declines and helps benefit from more rapidly expanding economies. Yet, such expansion also introduces challenges related to currency fluctuations, geopolitical uncertainties and varied market behaviors.

Upon examining EFX's recent quarterly performance, we noticed several interesting patterns in the revenue generated from its international segments, which are commonly analyzed and observed by Wall Street experts.

The company's total revenue for the quarter amounted to $1.42 billion, showing rise of 7%. We will now explore the breakdown of EFX's overseas revenue to assess the impact of its international operations.

A Dive into EFX's International Revenue Trends

Asia Pacific generated $84 million in revenues for the company in the last quarter, constituting 5.92% of the total. This represented a surprise of -2.83% compared to the $86.45 million projected by Wall Street analysts. Comparatively, in the previous quarter, Asia Pacific accounted for $88.5 million (6.14%), and in the year-ago quarter, it contributed $82.2 million (6.20%) to the total revenue.

During the quarter, Latin America contributed $99.9 million in revenue, making up 7.04% of the total revenue. When compared to the consensus estimate of $107.99 million, this meant a surprise of -7.49%. Looking back, Latin America contributed $96.7 million, or 6.71%, in the previous quarter, and $98.6 million, or 7.43%, in the same quarter of the previous year.

Europe accounted for 7.03% of the company's total revenue during the quarter, translating to $99.8 million. Revenues from this region represented a surprise of -0.05%, with Wall Street analysts collectively expecting $99.85 million. When compared to the preceding quarter and the same quarter in the previous year, Europe contributed $94.9 million (6.58%) and $93.6 million (7.06%) to the total revenue, respectively.

Of the total revenue, $65.1 million came from Canada during the last fiscal quarter, accounting for 4.59%. This represented a surprise of +0.41% as analysts had expected the region to contribute $64.84 million to the total revenue. In comparison, the region contributed $64.8 million, or 4.49%, and $64.9 million, or 4.89%, to total revenue in the previous and year-ago quarters, respectively.

Prospective Revenues in International Markets

For the current fiscal quarter, it is anticipated by Wall Street analysts that Equifax will report a total revenue of $1.41 billion, which reflects an increase of 1.6% from the same quarter in the previous year. The revenue contributions are expected to be 5.9% from Asia Pacific ($83 million), 7.2% from Latin America ($101.36 million), 6.5% from Europe ($91.83 million) and 4.7% from Canada ($66.68 million).

For the full year, a total revenue of $5.97 billion is expected for the company, reflecting an increase of 5.1% from the year before. The revenues from Asia Pacific, Latin America, Europe and Canada are expected to make up 5.9%, 7.5%, 6.6% and 4.6% of this total, corresponding to $354.22 million, $447.19 million, $392.55 million and $272.46 million respectively.

The Bottom Line

The dependency of Equifax on global markets for its revenues presents a mix of potential gains and hazards. Thus, monitoring the trends in its overseas revenues can be a key indicator for predicting the firm's future performance.

In an era of growing international ties and escalating geopolitical disputes, financial analysts on Wall Street pay keen attention to these developments to fine-tune their earnings estimations for businesses operating across borders. It's important to note, however, that a range of additional variables, like a company's local market status, also play a crucial role in shaping these forecasts.

Emphasizing a company's shifting earnings prospects is a key aspect of our approach at Zacks, especially since research has proven its substantial influence on a stock's price in the short run. This correlation is positively aligned, meaning that improved earnings projections tend to boost the stock's price.

Our proprietary stock rating tool, the Zacks Rank, with its externally validated exceptional track record, harnesses the power of earnings estimate revisions to serve as a dependable measure for anticipating the short-term price trends of stocks.

Equifax, bearing a Zacks Rank #5 (Strong Sell), is expected to underperform the broader market's movements in the near term. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

A Review of Equifax's Recent Stock Market Performance

The stock has witnessed an increase of 2.2% over the past month versus the Zacks S&P 500 composite's an increase of 4.2%. In the same interval, the Zacks Business Services sector, to which Equifax belongs, has registered an increase of 13.7%. Over the past three months, the company's shares saw an increase of 3.1%, while the S&P 500 increased by 1.5%. In comparison, the sector experienced an increase of 9.2% during this timeframe.