Equifax Inc. (EFX): A Bull Case Theory

Core Thesis - Equifax Inc. is positioned as a diversified analytics and verification powerhouse, evolving from a traditional credit bureau, with over half of its total sales now coming from recurring revenue sources [2][3] Financial Performance - Equifax's stock has declined 20% over the past year, underperforming the S&P 500, which gained 21%, primarily due to cyclical weakness in mortgage originations affecting its Workforce Solutions segment, contributing around 43% of total revenue [3] - Revenue has grown at a 9% CAGR over the past decade, with projected annualized growth of 7-9% through 2027 [5] Valuation Metrics - The company's trailing and forward P/E ratios are 45.38 and 25.77 respectively, with an intrinsic value estimated at $270 per share, indicating a potential upside of approximately 22% [1][5] - Return on invested capital is improving but remains below the cost of capital, with a 10-year median of roughly 8% [4] Competitive Advantages - Equifax's proprietary employment and income databases provide a competitive edge for verification processes across U.S. lenders and government agencies, creating strong network effects [4] - The company has deep integration into financial and HR systems, enhancing its market position [4] Management Outlook - Management's guidance indicates confidence in low-double-digit EPS growth into FY2025, reflecting expectations of operating leverage, normalization of credit cycles, and pricing strength [3]