Industrials
Even with the current stock price up 80% off the low on Oct 30th, following what Craig Huber believed was a significant overreaction to the 3Q23 earnings announcement, he recommends buying the stock at these levels trading at only 14.1x/12.2x his 2024/25 EBITDA estimates or 19.2x/15.8x adjusted EPS. Craig thinks Street estimates for 2025/26 are materially too low and will need to come up in the coming quarters. The US mortgage market has finally reached the bottom and mortgage recovery in 2025/26 should be quite robust. Cost savings from the transformation programme should also be very beneficial – Craig expects adjusted EBITDA margin improvement of 339 bps in 2026(E) vs. 2023. 12-month TP $96 (30% upside).
Edition: 185
- 03 May, 2024
Industrials
Investors are trading the stock as if TRU is in long-term secular decline and / or losing share to a competitor(s). Craig Huber disagrees. He considers the near-term pressure on revenue to be cyclical in nature as the market adjusts to a higher interest rate and weaker macro environment. Meanwhile, management has announced a multi-year transformation effort to reduce costs, accelerate innovation and drive growth. The $120-140m of annual costs savings, and the timing to achieve, fits within the assumptions that Craig had already made. His 2023-2025 EPS estimates are $3.32 / $3.58 / $4.17. TRU continues to be the most mispriced stock he covers.
Edition: 174
- 24 November, 2023
Equifax (EFX US) US
Technology
Craig Huber initiates coverage on this high quality, fast growing information services company. He believes that EFX’s differentiated offering sets it apart from its peers. Highlights its unique datasets, cloud transformation and increased focus on fintech. US Information Solutions pipelines are at the highest level since 2017. New product innovation revenue growth to accelerate to up 75% this year. TransUnion’s entrance into the income and employment verification market will not negatively impact the business. Craig’s earnings model and 10-year DCF analysis are also included in the report.
Edition: 109
- 30 April, 2021