Equifax (EFX) poised for earnings beat: Here’s why
Get ready for Equifax’s (EFX) third-quarter 2024 earnings report, scheduled for release after market close on October 16th. The company has a strong track record of exceeding earnings expectations, having outperformed the Zacks Consensus Estimate in three out of the last four quarters, with an average beat of 3.2%.
What to expect from Equifax’s Q3
Analysts are anticipating strong revenue growth for the quarter, with the Zacks Consensus Estimate pegged at $1.4 billion, representing a 9.5% increase year-over-year. This growth is expected to be driven by improved performance across all of Equifax’s segments.
The consensus estimate for earnings per share is $1.8, indicating a 4.6% year-over-year increase. This positive outlook is fueled by anticipated strong margin performance.
Segment-level expectations
Equifax’s international revenues are projected to see a significant 25.4% year-over-year increase to $366.4 million, fueled by continued growth in Europe and Latin America.
In the US, Equifax’s Information Solutions segment is expected to report a 7.8% year-over-year revenue increase, reaching $459.4 million. This growth is attributed to a robust pricing environment and the strength of Equifax’s pre-qualification products.
Equifax’s Workforce Solutions segment is expected to see a 7.1% year-over-year growth in revenue, reaching $618.1 million.
Adjusted EBITDA
The adjusted EBITDA for the US Information Solutions and International segments are expected to witness year-over-year growth of 7.2% and 24.2% to $156.3 million and $102.9 million, respectively, driven by strong revenue growth. The adjusted EBITDA for Workplace Solutions is projected to reach $318.3 million, representing an 8.4% increase year-over-year, driven by strong non-mortgage verifier revenue growth and efficient cost execution.
Our model’s prediction
Our proven model predicts an earnings beat for Equifax. The combination of a positive Earnings ESP and a Zacks Rank #2 (Buy) increases the odds of an earnings beat. Equifax currently boasts an Earnings ESP of +1.56% and a Zacks Rank of 2, further solidifying its potential for a positive earnings surprise.
Other stocks to consider
Here are a few other stocks in the broader Business Services sector that, according to our model, are well-positioned for earnings beats this season:
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Booz Allen Hamilton (BAH):
The Zacks Consensus Estimate for the company’s second-quarter fiscal 2025 revenues is pegged at $3 billion, implying a 10.9% increase from the year-ago quarter’s reported figure. For earnings, the consensus mark is pegged at $1.5 per share, suggesting a 14.7% rise from the year-ago quarter’s actual. BAH is scheduled to declare its second-quarter fiscal 2025 results on October 25th.*
Fiserv (FI):
The Zacks Consensus Estimate for the company’s third-quarter 2024 revenues is pegged at $4.9 billion, indicating a year-over-year 6.3% rise. For earnings, the consensus mark is pegged at $2.3 per share, suggesting a 14.8% rise from the year-ago quarter’s reported figure. The company is scheduled to declare its third-quarter 2024 results on October 22nd.Keep an eye on Equifax’s earnings release and these other promising stocks for potential investment opportunities.