Equifax Inc.EFX is striving to enhance and strengthen cybersecurity globally. The company has significantly increased investment in technology to revive from the 2017 cyberattack and bring back customers' confidence.
With expected long-term earnings per share (EPS) growth rate of 7.2% and a market cap of $11.2 billion, it seems to be a stock that investors should retain in their portfolios now.
Factors That Bode Well forEquifax
Equifax deploys advanced statistical techniques along with proprietary tools to analyze all available data and create customized insights, decision-making solutions as well as processing services. This helps customers understand, manage as well as protect clients' information and make more informed financial decisions.
Product innovation and continued investments in expansion of Ignite analytics and linking platforms globally are top priorities for Equifax and part of its technology transformation endeavor. We believe that the company's recently developed AI-enabled Advanced Model Engine will enhance Ignite to collaborate with customers. We believe that a solid product portfolio and understanding of the sector will keep Equifax stay competitive.
Equifax, Inc. Revenue (TTM)
Acquisitions are a key growth catalyst for Equifax. The company is continuously acquiring and investing in companies on a global scale to supplement the core business, strengthen market share and increase geographic presence.
The recent buyout of DataX has added alternative credit and payment data, analytics and identity solutions for underbanked consumers to Equifax core credit database. This enables Equifax to expand borrowing options for the underbanked population in installment loan, rent-to-own and lease-to-own markets.
Other benefits from DataX include credit reporting, ID verification, bank account verification and custom risk services. JLR Inc., acquired by Equifax Canada in December 2018, is likely to strengthen its foothold in the Canadian mortgage industry.
Equifax is active on the partnership font to reinforce Cyber security. The recent collaboration with World Economic Forum's Centre for Cybersecurity is aimed at sharing best practices to predict and identify potential cyber threats as well as strengthen global cybersecurity. The company has also partnered with Better Identity Coalition to find solutions for enhanced and more secured identity verification beyond the Social Security Number. Moreover, the company is undertaking efforts to leverage Atlanta for the Advancement of Security ("ATLAS") to boost assistance for a better identity solution.
Equifax joined forces with Oplogic, a provider of CRM solutions for automotive dealerships, to enable auto dealers detect fraud.
The cyber breach has heavily tarnished the brand image, reputation and credibility of Equifax. The company is bearing the brunt of higher costs as it has increased spending on technology post the incident. However, we believe that synergies from acquisitions along with continued general consumer credit activity, product innovation, initiatives to boost enterprise growth and efficient business executions will fuel growth in the long run.
Zacks Rank & Stocks to Consider
Equifax currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
Some better-ranked stocks in the broader Zacks Business Services sector are Waste Connections WCN , Republic Services RSG and Navigant Consulting NCI , each carrying a Zacks Rank #2 (Buy). Long-term expected EPS (three to five years) growth rates for Waste Connections, Republic Services and Navigant are 10.7%, 11.7% and 13.5%, respectively.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.