Dun & Bradstreet Corporation (DNB): New Analyst Report from Zacks Equity Research - Zacks Equity Research Report


D&B reported upbeat second-quarter 2014 results. Both earnings per share as well as revenues beat the Zacks Consensus Estimate. The company provided cautious guidance due to sluggish growth prospects of the core risk management solution business. This is expected to remain an overhang on the stock. We believe that D&B's high-margin business model, strong international growth potential, strategic investments, accretive cloud-based acquisitions and aggressive share buyback will drive growth in the long run. Moreover, partnerships with the likes of Salesforce.com, Sugar CRM and First Rain will help the company to expand its data-as-a-service model, which in turn will boost top-line growth. However, increasing competition will continue to hurt revenues and profitability in 2014. Moreover, a high debt level remains a concern. Thus, we maintain our Neutral recommendation and set a price target of $122.00.


Based in Short Hills, NJ, The Dun & Bradstreet Corporation (DNB) is a leading provider of commercial information that serves a diverse set of customer needs globally. D&B reported revenues (including revenues from divested business) of $1.66 billion in 2013. The company has two core product lines Risk Management Solutions and Sales & Marketing Solutions.

Risk Management Solutions (63% of revenues in 2013) comprise traditional solutions (61% of revenues in 2013), Value-Added Risk Management solutions (31% of segment revenues) and Supply Management solutions (8% of revenues in 2013). The traditional solutions primarily include the core DNBi product line, as well database reports, which are used primarily by customers for making decisions about new credit applications. Value-added Solutions generally support automated decision-making and portfolio management. Customers use Supply Management Solutions to better understand the financial risk of their supply chain.

Sales and Marketing Solutions (37% of revenues in 2013) comprise the company's traditional solutions, such as marketing lists, labels, education business and electronic licensing solutions (38% of segment revenues). Value-added Solutions (62.0% of segment revenues) offer data management software like Optimizer and D&B360 product platform that integrates data into third-party Customer Relationship Management (CRM) applications.

D&B serves banks and other credit & financial institutions, manufacturers, wholesalers, retailers, government agencies, insurance companies and telecommunication companies, as well as sales, marketing and business development professionals. None of the customers accounted for more than 10% of revenues in 2013.

D&B faces significant competition in most of its geographic markets not only from local information providers but also from the likes of Equifax, Experian, infoGROUP and Graydon.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

This article appears in: Investing , Stocks

Referenced Stocks: CRM , DNB



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