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Equifax Inc. (EFX - Free Report) reported solid first-quarter 2020 results, wherein the company’s earnings and revenues surpassed the Zacks Consensus Estimate.
Adjusted earnings of $1.40 per share beat the consensus mark by 8.5% and improved 16% on a year-over-year basis. The reported figure exceeded the guided range of $1.29-$1.34.
Revenues of $957.9 million outpaced the consensus estimate by 4.2% and improved 13% year over year on a reported basis and 15% on a local currency basis. The reported figure exceeded the guided range of $915-$930 million.
Over the past year, shares of Equifax have gained 0.7% compared with 2% growth of the industry it belongs to. However, the Zacks S&P 500 composite declined 1.7%.
Let’s check out the numbers in detail.
Segmental Revenues
Revenues in the USIS division came in at $343.2 million, up 15% from the year-ago quarter. Within the division, Online Information Solutions revenues of $252.8 million were up 16% year over year. Mortgage Solutions revenues of $42.8 million improved 33% year over year. Financial Marketing Services revenues came in at $47.6 million, down 2% year over year. The segment contributed 36% to total revenues.
Revenues in the International division totaled $216 million, down 4% year over year on a reported basis but up 3% on a local currency basis. Asia Pacific revenues of $69.7 million declined 5% year over year on a reported basis but grew 3% on a local currency basis. Revenues from Europe came in at $66.4 million, which decreased 3% year over year on a reported basis and 1% on a local currency basis. Latin America revenues of $43.2 million declined 8% year over year on a reported basis but grew 9% on a local currency basis. Canada revenues of $36.7 million rose 1% year over year on a reported basis and 2% on a local currency basis. The International segment contributed 23% to total revenues.
Revenues in the Workforce Solutions segment totaled $301.6 million, up 32% from the year-ago quarter’s figure. Within the segment, Verification Services revenues of $220.2 million were up 48% year over year. Employer Services revenues of $81.4 million were up 2% year over year. Workforce Solutions contributed 31% to total revenues.
Revenues in the Global Consumer Solutions segment amounted to $97.1 million, up 3% year over year on a reported basis and local currency basis. The segment contributed 10% to total revenues.
Adjusted EBITDA margin in the first quarter of 2020 rose to 32.4% from 30.5% in the year-ago quarter.
Adjusted EBITDA margin for USIS was 44.7% compared with 42.9% in the year-ago quarter. Adjusted EBITDA margin for the International segment was 27.8% compared with 25.3% in the prior-year quarter. Workforce Solutions’ adjusted EBITDA margin was 51.5% compared with 49.4% a year ago. Adjusted EBITDA margin for Global Consumer Solutions was 23.1% compared with 23.9% in the year-ago quarter.
Equifax exited first-quarter 2020 with cash and cash equivalents of $369.9 million compared with $401.3 million at the end of the prior quarter. Long-term debt was $3.51 billion compared with $3.38 billion at the end of the prior quarter.
The company generated $30.8 million of cash from operating activities and capex was $88 million. Also, Equifax paid out dividend of $47.3 million to shareholders in the reported quarter.
Investors interested in the broader Zacks Business Services sector are awaiting first-quarter 2020 earnings of key players like Verisk (VRSK - Free Report) , Republic Services (RSG - Free Report) and Fiserv . While Verisk and Republic Services are slated to release their results on May 5, Fiserv is scheduled to release the same on May 7.
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Equifax (EFX) Surpasses Q1 Earnings & Revenue Estimates
Equifax Inc. (EFX - Free Report) reported solid first-quarter 2020 results, wherein the company’s earnings and revenues surpassed the Zacks Consensus Estimate.
Adjusted earnings of $1.40 per share beat the consensus mark by 8.5% and improved 16% on a year-over-year basis. The reported figure exceeded the guided range of $1.29-$1.34.
Revenues of $957.9 million outpaced the consensus estimate by 4.2% and improved 13% year over year on a reported basis and 15% on a local currency basis. The reported figure exceeded the guided range of $915-$930 million.
Over the past year, shares of Equifax have gained 0.7% compared with 2% growth of the industry it belongs to. However, the Zacks S&P 500 composite declined 1.7%.
Let’s check out the numbers in detail.
Segmental Revenues
Revenues in the USIS division came in at $343.2 million, up 15% from the year-ago quarter. Within the division, Online Information Solutions revenues of $252.8 million were up 16% year over year. Mortgage Solutions revenues of $42.8 million improved 33% year over year. Financial Marketing Services revenues came in at $47.6 million, down 2% year over year. The segment contributed 36% to total revenues.
Revenues in the International division totaled $216 million, down 4% year over year on a reported basis but up 3% on a local currency basis. Asia Pacific revenues of $69.7 million declined 5% year over year on a reported basis but grew 3% on a local currency basis. Revenues from Europe came in at $66.4 million, which decreased 3% year over year on a reported basis and 1% on a local currency basis. Latin America revenues of $43.2 million declined 8% year over year on a reported basis but grew 9% on a local currency basis. Canada revenues of $36.7 million rose 1% year over year on a reported basis and 2% on a local currency basis. The International segment contributed 23% to total revenues.
Revenues in the Workforce Solutions segment totaled $301.6 million, up 32% from the year-ago quarter’s figure. Within the segment, Verification Services revenues of $220.2 million were up 48% year over year. Employer Services revenues of $81.4 million were up 2% year over year. Workforce Solutions contributed 31% to total revenues.
Revenues in the Global Consumer Solutions segment amounted to $97.1 million, up 3% year over year on a reported basis and local currency basis. The segment contributed 10% to total revenues.
Equifax, Inc. Revenue (TTM)
Equifax, Inc. revenue-ttm | Equifax, Inc. Quote
Operating Results
Adjusted EBITDA margin in the first quarter of 2020 rose to 32.4% from 30.5% in the year-ago quarter.
Adjusted EBITDA margin for USIS was 44.7% compared with 42.9% in the year-ago quarter. Adjusted EBITDA margin for the International segment was 27.8% compared with 25.3% in the prior-year quarter. Workforce Solutions’ adjusted EBITDA margin was 51.5% compared with 49.4% a year ago. Adjusted EBITDA margin for Global Consumer Solutions was 23.1% compared with 23.9% in the year-ago quarter.
Equifax, Inc. Price, Consensus and EPS Surprise
Equifax, Inc. price-consensus-eps-surprise-chart | Equifax, Inc. Quote
Balance Sheet and Cash Flow
Equifax exited first-quarter 2020 with cash and cash equivalents of $369.9 million compared with $401.3 million at the end of the prior quarter. Long-term debt was $3.51 billion compared with $3.38 billion at the end of the prior quarter.
The company generated $30.8 million of cash from operating activities and capex was $88 million. Also, Equifax paid out dividend of $47.3 million to shareholders in the reported quarter.
Zacks Rank & Upcoming Releases
Currently, Equifax carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Investors interested in the broader Zacks Business Services sector are awaiting first-quarter 2020 earnings of key players like Verisk (VRSK - Free Report) , Republic Services (RSG - Free Report) and Fiserv . While Verisk and Republic Services are slated to release their results on May 5, Fiserv is scheduled to release the same on May 7.
Today's Best Stocks from Zacks
Would you like to see the updated picks from our best market-beating strategies? From 2017 through 2019, while the S&P 500 gained and impressive +53.6%, five of our strategies returned +65.8%, +97.1%, +118.0%, +175.7% and even +186.7%.
This outperformance has not just been a recent phenomenon. From 2000 – 2019, while the S&P averaged +6.0% per year, our top strategies averaged up to +54.7% per year.
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