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Equifax (EFX) Surpasses Q1 Earnings & Revenue Estimates

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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.

Equifax, Inc. Revenue (TTM)

 

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 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 (FISV - Free Report) . 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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