The 10-second takeaway
For the quarter ended June 30 (Q2), Equifax beat slightly on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded. Non-GAAP earnings per share increased significantly. GAAP earnings per share increased significantly.
Margins grew across the board.
Equifax booked revenue of $586.9 million. The 11 analysts polled by S&P Capital IQ foresaw sales of $577.0 million on the same basis. GAAP reported sales were 14% higher than the prior-year quarter's $513.3 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures are normalized by S&P Capital IQ and may vary to maintain comparability with normalized estimates.
EPS came in at $0.92. The 13 earnings estimates compiled by S&P Capital IQ forecast $0.90 per share. Non-GAAP EPS of $0.92 for Q2 were 24% higher than the prior-year quarter's $0.74 per share. (The prior-year quarter included $0.02 per share in earnings from discontinued operations.) GAAP EPS of $0.73 for Q2 were 18% higher than the prior-year quarter's $0.62 per share. (The prior-year quarter included $0.02 per share in earnings from discontinued operations.)
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures are normalized by S&P Capital IQ and may vary to maintain comparability with normalized estimates.
For the quarter, gross margin was 66.2%, 270 basis points better than the prior-year quarter. Operating margin was 26.9%, 180 basis points better than the prior-year quarter. Net margin was 15.4%, 50 basis points better than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $574.6 million. On the bottom line, the average EPS estimate is $0.90.
Next year's average estimate for revenue is $2.32 billion. The average EPS estimate is $3.61.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 104 members out of 117 rating the stock outperform, and 13 members rating it underperform. Among 36 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 32 give Equifax a green thumbs-up, and four give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Equifax is outperform, with an average price target of $65.08.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.