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TransUnion (TRU)
NYSE:TRU
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TransUnion
(NYSE:TRU)
Rating:72Outperform
Price Target:
$91.00
▲( 7.72% Upside)
Positive Factors
Geographic Growth
Management expects a sequential acceleration in India, supported by new business wins and a pro-growth RBI, indicating potential for long-term growth in the region.
Platform Development
The OneTru platform could drive margin expansion, with TRU aiming for significant expense savings and a reduction in capex.
Shareholder Returns
TRU initiated its first share repurchase since 2017 and increased its quarterly dividend by 9.5%.
Negative Factors
Conservative Forecast
Full year guide reflects a conservative outlook.
Guidance Concerns
TRU’s 1Q beat did not translate into a guidance bump.
Leverage Risk
Leverage of 2.9x remains above their target.
TransUnion (TRU) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$17.64B
Dividend Yield0.52%
Average Volume (3M)2.13M
Price to Earnings (P/E)48.4
Beta (1Y)1.93
Revenue Growth8.85%
EPS GrowthN/A
CountryUS
Employees13,000
SectorIndustrials
Sector Strength90
IndustryConsulting Services
Share Statistics
EPS (TTM)1.05
Shares Outstanding195,140,440
10 Day Avg. Volume1,881,751
30 Day Avg. Volume2,125,683
Financial Highlights & Ratios
PEG Ratio1.57
Price to Book (P/B)3.76
Price to Sales (P/S)0.00
P/FCF Ratio33.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$106.10Price Target Upside25.59% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering12
TransUnion Business Overview & Revenue Model
Company DescriptionTransUnion (TRU) is a global information and insights company that operates in the financial services sector. It provides credit information and analytics to consumers and businesses, empowering them to make informed decisions. TransUnion's core offerings include credit reports, risk management solutions, and decision-making analytics that are used by financial institutions, insurance companies, and various other industries to assess creditworthiness and manage risk.
How the Company Makes MoneyTransUnion generates revenue primarily through the sale of its credit information and risk management solutions to businesses and consumers. The company earns money by providing credit reports and analytics to financial institutions, which use these products to evaluate the credit risk of potential borrowers and manage existing credit portfolios. Additionally, TransUnion offers identity protection and credit monitoring services directly to consumers who subscribe to these services for a fee. The company also collaborates with various partners to offer integrated solutions that enhance its data and analytics capabilities, contributing to its earnings. Revenue streams are diversified across different sectors, including financial services, insurance, and healthcare, where its solutions help in decision-making and risk assessment.
TransUnion Financial Statement Overview
Summary
TransUnion demonstrates strong financial performance with solid revenue growth and robust profitability margins. The income statement shows efficient cost management with a significant net profit margin of 10.66%. The balance sheet is stable with moderate leverage, while cash flow generation is effective, although attention to free cash flow growth is needed.Income Statement
TransUnion's TTM (Trailing-Twelve-Months) revenue growth rate is solid, reflecting a positive trajectory with a 1.78% increase from the previous annual period. The gross profit margin stands robustly at 70.22%, indicating strong cost management in relation to revenue. The net profit margin improved significantly over the past year to 10.66%, suggesting enhanced profitability. EBIT and EBITDA margins are healthy at 17.94% and 28.06%, respectively, highlighting efficient operations. Overall, the income statement shows a well-managed and profitable business with consistent revenue and profit growth.82
Very Positive
Balance Sheet
The balance sheet reflects a stable financial position, with a debt-to-equity ratio of 1.17, indicating moderate leverage compared to equity. The return on equity (ROE) improved to 10.35%, showcasing effective utilization of shareholder funds to generate profit. The equity ratio is reasonable at 40.06%, suggesting a balanced approach between debt and equity financing. While leverage is manageable, the company should remain cautious of debt levels to ensure long-term financial health.75
Positive
Cash Flow
TransUnion's cash flow statement reveals a strong operating cash flow to net income ratio of 1.81, indicating efficient cash conversion from earnings. The free cash flow to net income ratio is solid at 1.10, reflecting effective cash generation relative to profits. However, free cash flow growth has been negative at -3.16% compared to the previous annual period, highlighting a slight decline in cash generation. Overall, the cash flow position remains strong, with effective cash management, though attention to free cash flow growth is warranted.78
Positive
| Breakdown | |||||
| TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 4.26B | 4.18B | 3.83B | 3.71B | 2.96B | 2.53B | Gross Profit |
| 2.55B | 2.51B | 2.31B | 2.32B | 1.94B | 1.68B | EBIT |
| 764.00M | 666.70M | 128.50M | 626.30M | 651.90M | 500.30M | EBITDA |
| 1.31B | 1.20B | 667.30M | 1.13B | 995.20M | 862.50M | Net Income Common Stockholders |
| 367.30M | 284.40M | -206.20M | 266.30M | 1.39B | 343.20M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 612.50M | 682.00M | 478.90M | 585.30M | 1.84B | 493.00M | Total Assets |
| 10.95B | 10.98B | 11.11B | 11.67B | 12.63B | 7.31B | Total Debt |
| 5.20B | 5.21B | 5.45B | 5.67B | 6.37B | 3.45B | Net Debt |
| 4.59B | 4.53B | 4.97B | 5.08B | 4.52B | 2.96B | Total Liabilities |
| 6.46B | 6.67B | 7.00B | 7.40B | 8.63B | 4.68B | Stockholders Equity |
| 4.39B | 4.22B | 4.01B | 4.17B | 3.91B | 2.54B |
| Cash Flow | Free Cash Flow | ||||
| 500.40M | 516.70M | 334.70M | -1.00M | 584.10M | 573.30M | Operating Cash Flow |
| 822.20M | 832.50M | 645.40M | 297.20M | 808.30M | 787.40M | Investing Cash Flow |
| -331.60M | -307.40M | -318.90M | -723.90M | -2.21B | -267.20M | Financing Cash Flow |
| -309.20M | -308.70M | -438.80M | -820.50M | 2.76B | -296.90M |
TransUnion Technical Analysis
Negative
84.48
Price Trends
82.16
Positive
87.58
Negative
93.39
Negative
Market Momentum
1.86
Positive
48.43
Neutral
29.42
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TRU, the sentiment is Negative. The current price of 84.48 is below the 20-day moving average (MA) of 86.40, above the 50-day MA of 82.16, and below the 200-day MA of 93.39, indicating a neutral trend. The MACD of 1.86 indicates Positive momentum. The RSI at 48.43 is Neutral, neither overbought nor oversold. The STOCH value of 29.42 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TRU.
TransUnion Risk Analysis
TransUnion disclosed 39 risk factors in its most recent earnings report. TransUnion reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 2 New Risks
1.
There can be no assurance that we will repurchase shares pursuant to our share repurchase program consistent with historical amounts or at all. Q4, 2024
2.
We currently use, and will continue to invest in the use of, AI Technologies, which use is subject to a continuously evolving regulatory landscape. The evolving regulatory landscape may impact our use of AI Technologies, require additional compliance measures and changes to our operations and processes, which could result in increased compliance costs and potential increases in civil claims against us, and could adversely affect our business, operations and financial condition. Q4, 2024
TransUnion Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $43.80B | 45.85 | 475.86% | 0.52% | 7.20% | 27.36% | |
73 Outperform | $34.41B | 56.57 | 12.83% | 0.60% | 7.12% | 9.05% | |
72 Outperform | $17.64B | 48.42 | 8.68% | 0.52% | 8.85% | ― | |
64 Neutral | $4.39B | 11.81 | 5.17% | 249.38% | 3.98% | -12.17% |
* Industrials Sector Average
Performance Comparison
TRU
TransUnion
84.48
9.95
13.35%
EFX
Equifax
263.41
27.30
11.56%
VRSK
Verisk Analytics
314.34
66.55
26.86%
TransUnion Earnings Call Summary
Earnings Call Date:Apr 24, 2025
(Q1-2025)
| % Change Since: 9.50%|
Next Earnings Date:Jul 29, 2025
Earnings Call Sentiment Positive
TransUnion reported strong revenue growth and strategic progress, particularly in its U.S. Market and international segments. Despite some challenges in specific segments such as Consumer Interactive and Public Sector, the company's transformation initiatives and improved capital allocation are positive indicators. The overall outlook remains cautious due to economic uncertainties.Q1-2025 Updates
Positive Updates
Record Revenue Growth
TransUnion delivered high single-digit organic revenue growth and double-digit adjusted diluted EPS growth for the fifth consecutive quarter, with revenue growing 8% on an organic constant currency basis.
Strong U.S. Market Performance
The U.S. Market segment delivered 9% growth, with financial services growing 15%. Consumer lending and auto both grew double digits, while card and banking grew mid-single digits.
Successful Strategic Initiatives
TransUnion made key leadership additions and progressed on its technology modernization with the OneTrue platform, achieving over 50% faster processing speeds and a 20% to 50% increase in developer productivity.
International Growth
International revenue grew 6% on a constant currency basis, with the UK delivering strong 9% growth. The company expects India to reaccelerate to 10% growth for the full year.
Improved Capital Allocation
The leverage ratio declined to 2.9x from 3.5x a year ago, and the company repurchased shares for the first time since 2017, anticipating further capital deployment flexibility.
Negative Updates
Challenges in Consumer Interactive Segment
The Consumer Interactive segment declined 1% as anticipated, with plans to launch a new freemium solution later in the year.
Mortgage Inquiry Decline
Mortgage inquiries were down roughly 10%, although revenue grew 27% due to favorable pricing.
Public Sector Revenue Decline
Public Sector revenue declined modestly year-over-year due to strong growth lapping from the previous year.
One-Time Transformation Charges
The company took $30 million in one-time charges related to its transformation program.
Company Guidance
During the TransUnion 2025 First Quarter Earnings Conference Call, the company provided guidance with several key metrics and insights into its performance and outlook. TransUnion reported an 8% organic constant currency revenue growth for the first quarter, surpassing its 5% to 6% guidance, and achieved double-digit adjusted diluted EPS growth. The U.S. Market segment grew by 9%, with financial services growing 15%, excluding mortgage growth at 9%. International markets grew by 6%, with the UK showing strong 9% plus growth. The company maintained its full-year organic growth guidance, anticipating revenue between $4.358 billion and $4.417 billion, with adjusted EBITDA between $1.549 billion and $1.590 billion. Adjusted EBITDA margin is expected to be between 35.6% and 36%. TransUnion's leverage ratio improved to 2.9 times from 3.5 times a year ago, and the company repurchased 10 million shares for the first time since 2017. Despite maintaining the guidance, TransUnion acknowledged market uncertainties, including potential impacts from U.S. fiscal policy changes, tariffs, and global economic conditions.TransUnion Corporate Events
Shareholder Meetings
TransUnion Holds Annual Stockholders Meeting, Votes on Key Proposals
Neutral
May 9, 2025
On May 7, 2025, TransUnion held its Annual Meeting of Stockholders, where key proposals were voted on, including the election of ten directors for a one-year term, the ratification of PricewaterhouseCoopers LLP as the independent accounting firm for 2025, and an advisory vote on executive compensation. The outcomes of these votes, which were in favor of the proposals, reflect the company’s ongoing governance practices and stakeholder engagement.
Business Operations and StrategyFinancial Disclosures
TransUnion Reports Strong Q1 2025 Financial Results
Positive
Apr 24, 2025
On April 24, 2025, TransUnion announced its financial results for the first quarter of 2025, reporting a total revenue of $1,096 million, which marks a 7% increase from the previous year. The company exceeded its financial guidance across all key metrics, with significant growth in U.S. Financial Services and Emerging Verticals. Despite challenging market conditions, TransUnion maintained its revenue growth guidance for 2025 and highlighted its ability to navigate potential economic downturns through a diversified portfolio and strategic cost management.
Business Operations and Strategy
TransUnion Amends Employee Stock Purchase Plan
Neutral
Feb 24, 2025
On February 19, 2025, TransUnion’s Board of Directors approved an amendment to the company’s 2015 Employee Stock Purchase Plan (ESPP). This amendment removes the ten-year term limit, allowing the plan to terminate either by the Board’s decision or upon the issuance of all available shares. This change may impact the company’s employee stock purchase strategy and provide more flexibility in managing stock distributions.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.