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Adjusted EPS of 69 cents outpaced the consensus mark by 4 cents and improved 11% year over year.
Total revenues came in at $662 million, which beat the consensus mark by $17 million, increasing 18% year over year on a reported basis, 19% on a constant-currency basis and 10% on an organic constant-currency basis. This uptick was driven by strong performance across all the operating segments of the company — U.S. Markets, International and Consumer Interactive.
Adjusted revenues (excluding the impact of deferred revenue purchase accounting reductions and other adjustments to revenues for the company’s recently acquired entities) came in at $664 million, up 18% year over year on a reported basis, 19% at constant currency and 10% at organic constant currency. Acquisitions of iovation, HPS, Rubixis, Callcredit and TruSignal drove adjusted revenues.
We observe that shares of TransUnion have gained a massive 48.3% year to date, outperforming the 38.4% rally of the industry it belongs to.
Revenue Growth Across All Segments
The U.S. Markets revenues of $406 million increased 13% year over year on a reported basis and 8% on an organic basis. Adjusted revenues also came in at $406 million. Within the segment, Financial Services revenues of $213 million increased 11% and 8%, respectively, on a reported and organic basis. Emerging Verticals revenues, including Healthcare, Insurance and all other verticals, were $193 million, up 16% year over year on a reported basis and 8% on an organic basis.
International revenues surged 42% year over year on a reported, 49% at constant currency and 20% on an organic constant-currency basis to $151 million. Adjusted revenues came in at $153 million. Canada, Latin America and India revenues increased but Asia Pacific revenues decreased year over year on a reported as well as constant-currency basis.
Revenues at the Consumer Interactive segment improved 5% from the prior-year quarter number to $124 million.
Adjusted EBITDA was $264 million, up 20% year over year on a reported and 21% at constant currency. Adjusted EBITDA margin of 39.7% expanded 50 basis points (bps) year over year.
Balance Sheet and Cash Flow
TransUnion had $194.7 million in cash and cash equivalents at the end of the second quarter compared with $200.9 million at the end of the prior quarter. Long-term debt was $3.8 billion, compared with roughly $4 billion in the prior quarter. The company generated $177.2 million in cash from operating activities and CapEx was $46.1 million. The company paid out $14.1 million in dividends in the quarter.
Q3 Outlook
For the third quarter of 2019, TransUnion expects adjusted revenues between $672 million and $677 million, suggesting an improvement of 8-9% year over year.
Adjusted EBITDA is anticipated in the range of $269-$273 million, mirroring an increase of 10-11%. Adjusted EPS is expected between 69 cents and 71 cents, indicating a rise of 6-8% year over year. The Zacks Consensus Estimate for third-quarter earnings is pegged at 71 cents.
2019 View
TransUnion raised its 2019 guidance. The company now expects adjusted revenues between $2.628 billion and $2.638 billion, reflecting year-over-year increase of 12%. The previous guidance was between $2.603 billion and $2.618 billion.
Adjusted EBITDA is anticipated in the range of $1.036-$1.044 million, reflecting year-over-year increase of 13-14%. The previously anticipated range was $1.025-$1.037 million.
Adjusted EPS is anticipated in the band of $2.66-$2.69, indicating improvement of 6-8%. The previous expectation was in the band of $2.60-$2.65. The Zacks Consensus Estimate for adjusted earnings is pegged at $2.70.
Some other top-ranked stocks in the broader Zacks Business Services sector include Broadridge (BR - Free Report) , Accenture (ACN - Free Report) and Total System Services , each carrying a Zacks Rank #2.
The long-term expected EPS (three to five years) growth rate for Broadridge, Accenture and Total System is 10%, 10.3% and 12.1%, respectively.
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Image: Bigstock
TransUnion (TRU) Beats Earnings and Revenue Estimates in Q2
TransUnion (TRU - Free Report) delivered better-than-expected second-quarter 2019 results.
Adjusted EPS of 69 cents outpaced the consensus mark by 4 cents and improved 11% year over year.
Total revenues came in at $662 million, which beat the consensus mark by $17 million, increasing 18% year over year on a reported basis, 19% on a constant-currency basis and 10% on an organic constant-currency basis. This uptick was driven by strong performance across all the operating segments of the company — U.S. Markets, International and Consumer Interactive.
Adjusted revenues (excluding the impact of deferred revenue purchase accounting reductions and other adjustments to revenues for the company’s recently acquired entities) came in at $664 million, up 18% year over year on a reported basis, 19% at constant currency and 10% at organic constant currency. Acquisitions of iovation, HPS, Rubixis, Callcredit and TruSignal drove adjusted revenues.
We observe that shares of TransUnion have gained a massive 48.3% year to date, outperforming the 38.4% rally of the industry it belongs to.
Revenue Growth Across All Segments
The U.S. Markets revenues of $406 million increased 13% year over year on a reported basis and 8% on an organic basis. Adjusted revenues also came in at $406 million. Within the segment, Financial Services revenues of $213 million increased 11% and 8%, respectively, on a reported and organic basis. Emerging Verticals revenues, including Healthcare, Insurance and all other verticals, were $193 million, up 16% year over year on a reported basis and 8% on an organic basis.
International revenues surged 42% year over year on a reported, 49% at constant currency and 20% on an organic constant-currency basis to $151 million. Adjusted revenues came in at $153 million. Canada, Latin America and India revenues increased but Asia Pacific revenues decreased year over year on a reported as well as constant-currency basis.
Revenues at the Consumer Interactive segment improved 5% from the prior-year quarter number to $124 million.
TransUnion Revenue (TTM)
TransUnion revenue-ttm | TransUnion Quote
Margin Expanded
Adjusted EBITDA was $264 million, up 20% year over year on a reported and 21% at constant currency. Adjusted EBITDA margin of 39.7% expanded 50 basis points (bps) year over year.
Balance Sheet and Cash Flow
TransUnion had $194.7 million in cash and cash equivalents at the end of the second quarter compared with $200.9 million at the end of the prior quarter. Long-term debt was $3.8 billion, compared with roughly $4 billion in the prior quarter. The company generated $177.2 million in cash from operating activities and CapEx was $46.1 million. The company paid out $14.1 million in dividends in the quarter.
Q3 Outlook
For the third quarter of 2019, TransUnion expects adjusted revenues between $672 million and $677 million, suggesting an improvement of 8-9% year over year.
Adjusted EBITDA is anticipated in the range of $269-$273 million, mirroring an increase of 10-11%. Adjusted EPS is expected between 69 cents and 71 cents, indicating a rise of 6-8% year over year. The Zacks Consensus Estimate for third-quarter earnings is pegged at 71 cents.
2019 View
TransUnion raised its 2019 guidance. The company now expects adjusted revenues between $2.628 billion and $2.638 billion, reflecting year-over-year increase of 12%. The previous guidance was between $2.603 billion and $2.618 billion.
Adjusted EBITDA is anticipated in the range of $1.036-$1.044 million, reflecting year-over-year increase of 13-14%. The previously anticipated range was $1.025-$1.037 million.
Adjusted EPS is anticipated in the band of $2.66-$2.69, indicating improvement of 6-8%. The previous expectation was in the band of $2.60-$2.65. The Zacks Consensus Estimate for adjusted earnings is pegged at $2.70.
Zacks Rank & Other Stocks to Consider
Currently, TransUnion 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 include Broadridge (BR - Free Report) , Accenture (ACN - Free Report) and Total System Services , each carrying a Zacks Rank #2.
The long-term expected EPS (three to five years) growth rate for Broadridge, Accenture and Total System is 10%, 10.3% and 12.1%, respectively.
Radical New Technology Creates $12.3 Trillion Opportunity
Imagine buying Microsoft stock in the early days of personal computers… or Motorola after it released the world’s first cell phone. These technologies changed our lives and created massive profits for investors.
Today, we’re on the brink of the next quantum leap in technology. 7 innovative companies are leading this “4th Industrial Revolution” - and early investors stand to earn the biggest profits.
See the 7 breakthrough stocks now>>