Why Is TransUnion (TRU) Down 7.5% Since Last Earnings Report?

Core Viewpoint - TransUnion reported strong Q3 2024 earnings, with both earnings and revenues exceeding estimates, but the stock has underperformed the S&P 500 in the past month [1][2]. Financial Performance - Adjusted earnings per share (EPS) for Q3 2024 were $1, surpassing the consensus estimate by 2% and increasing 14.3% year-over-year [2]. - Total revenues reached $1.1 billion, exceeding the consensus mark by 2.2% and reflecting a 12% increase from the previous year [2]. Revenue Breakdown by Segments - U.S. Markets segment revenues were $848 million, up 12% year-over-year, with Financial Services revenues at $367 million, growing 17% [3]. - International segment revenues increased to $242 million, an 11% year-over-year rise, with Canada contributing $39 million, a 7% increase [4]. - Revenues from India were $68 million, up 21% year-over-year, while Asia-Pacific revenues were $26 million, reflecting an 11% increase [5]. Operating Performance - Adjusted EBITDA for Q3 was $377 million, marking an 11% year-over-year growth, with an adjusted EBITDA margin of 36.2%, up 120 basis points from the previous year [7]. Balance Sheet and Cash Flow - Cash and cash equivalents at the end of the quarter were $643.2 million, up from $543.2 million in the previous quarter, while long-term debt decreased to $5.1 billion [8]. - Cash generated from operating activities was $229.3 million, with capital expenditures amounting to $68 million [8]. Future Outlook - For Q4 2024, TransUnion expects revenues between $1.01 billion and $1.03 billion, with adjusted EPS guidance of 92-98 cents [9]. - For the full year 2024, revenue guidance has been raised to $4.16-$4.18 billion, with adjusted EPS guidance increased to $3.87-$3.93 [10]. Estimate Trends - Estimates for TransUnion have trended downward over the past month, with a Zacks Rank of 3 (Hold), indicating an expectation of in-line returns in the near term [11][13]. VGM Scores - TransUnion holds a Growth Score of B, a Momentum Score of C, and a Value Score of C, resulting in an aggregate VGM Score of C [12].