Stock Analysis & Valuation Equifax Inc. (0II3.L)

• Previous Close: £201.29
• Sector Valuation Confidence Level: Moderate

Valuation method	Value, £	Upside, %
Artificial intelligence (AI)	122.50	-39
Intrinsic value (DCF)	101.24	-50
Graham-Dodd Method		n/a
Graham Formula	57.90	-71

Strategic Investment Analysis

Company Overview

Equifax Inc. (LSE: 0II3.L) is a global leader in data, analytics, and technology, providing critical information solutions to businesses, governments, and consumers. Headquartered in Atlanta, Georgia, Equifax operates across three key segments: Workforce Solutions, U.S. Information Solutions (USIS), and International. The company specializes in credit reporting, identity verification, fraud prevention, and workforce analytics, serving industries such as financial services, mortgage lending, healthcare, and telecommunications. With a history dating back to 1899, Equifax has established itself as a trusted provider of consumer and commercial credit data, leveraging advanced analytics and AI-driven insights. Its international footprint spans North America, Europe, Latin America, and Asia-Pacific, making it a pivotal player in the global data economy. Equifax’s diversified offerings, including credit monitoring and HR outsourcing services, position it as a key enabler of financial inclusion and risk management. The company’s robust data infrastructure and compliance with regulatory standards reinforce its reputation in the specialty business services sector.

Investment Summary

Equifax presents a compelling investment case due to its dominant position in the credit reporting and data analytics industry, supported by recurring revenue streams and high switching costs for customers. The company’s strong operating cash flow ($1.32B in FY 2024) and diversified geographic presence mitigate sector-specific risks. However, its high beta (1.675) reflects sensitivity to macroeconomic conditions, and regulatory scrutiny in data privacy remains a persistent risk. The stock’s valuation is supported by steady earnings growth (EPS of $4.84) and a dividend yield of ~1.4%, but investors should monitor debt levels ($5.01B) and competitive pressures from fintech disruptors.

Competitive Analysis

Equifax holds a competitive edge through its extensive proprietary data assets, global scale, and entrenched relationships with financial institutions and employers. Its Workforce Solutions segment, in particular, benefits from exclusive access to payroll data, creating high barriers to entry. However, the company faces intensifying competition from digital-first players leveraging alternative data sources and AI-driven analytics. Equifax’s USIS segment competes directly with Experian and TransUnion in credit reporting, where differentiation relies on accuracy, breadth of coverage, and value-added services like fraud detection. Internationally, local credit bureaus and regional fintechs challenge its growth, especially in emerging markets. Equifax’s investments in cloud infrastructure and API integrations strengthen its technological moat, but its legacy systems in some regions lag behind agile competitors. Regulatory compliance costs also weigh on margins compared to smaller, niche players. Overall, Equifax’s scale and diversification provide resilience, but innovation in data monetization will be critical to maintaining leadership.

Major Competitors

• Experian plc (EXPN.L): Experian is Equifax’s closest peer, with a stronger international presence (particularly in Latin America and the UK) and a focus on consumer credit and marketing services. Its analytics platform, Ascend, is a differentiator, but it lacks Equifax’s depth in workforce solutions. Experian’s higher EBITDA margins (30% vs. Equifax’s ~25%) reflect operational efficiency.
• TransUnion (TRU): TransUnion competes in USIS and international credit reporting, with a growing emphasis on alternative data (e.g., rent and utility payments) to serve underbanked populations. Its acquisition of Neustar bolsters identity solutions, but it trails Equifax in employer-focused services. TransUnion’s higher revenue growth (8% YoY vs. Equifax’s 5%) comes at the cost of elevated leverage.
• Moody’s Corporation (MCO): Moody’s overlaps in analytics and risk assessment but focuses more on corporate credit ratings and ESG data. Its Kroll division competes in background screening, though it lacks Equifax’s integrated payroll verification. Moody’s benefits from lower regulatory risk but has less exposure to high-growth workforce analytics.
• Fair Isaac Corporation (FICO): FICO dominates credit scoring (FICO Score) but relies on Equifax and other bureaus for raw data. Its AI-driven decision platforms compete with Equifax’s analytics tools. FICO’s narrow focus limits diversification but allows for higher-margin software sales. Equifax’s broader data ecosystem gives it an edge in end-to-end solutions.