TRANSUNION (TRU)

US89400J1079 - Common Stock

76.62  -2.24 (-2.84%)

After market: 76.62 0 (0%)

Fundamental Rating

4

We assign a fundamental rating of 4 out of 10 to TRU. TRU was compared to 82 industry peers in the Professional Services industry. There are concerns on the financial health of TRU while its profitability can be described as average. While showing a medium growth rate, TRU is valued expensive at the moment.



4

1. Profitability

1.1 Basic Checks

In the past year TRU was profitable.
TRU had a positive operating cash flow in the past year.
Of the past 5 years TRU 4 years were profitable.
In the past 5 years TRU always reported a positive cash flow from operatings.

1.2 Ratios

TRU has a Return On Assets of -2.49%. This is in the lower half of the industry: TRU underperforms 75.31% of its industry peers.
Looking at the Return On Equity, with a value of -6.74%, TRU is doing worse than 75.31% of the companies in the same industry.
TRU has a Return On Invested Capital of 4.40%. This is comparable to the rest of the industry: TRU outperforms 44.44% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for TRU is significantly below the industry average of 11.79%.
The 3 year average ROIC (4.08%) for TRU is below the current ROIC(4.40%), indicating increased profibility in the last year.
Industry RankSector Rank
ROA -2.49%
ROE -6.74%
ROIC 4.4%
ROA(3y)3.81%
ROA(5y)4.2%
ROE(3y)12.27%
ROE(5y)13.16%
ROIC(3y)4.08%
ROIC(5y)4.63%

1.3 Margins

TRU has a Operating Margin of 16.56%. This is amongst the best in the industry. TRU outperforms 85.19% of its industry peers.
In the last couple of years the Operating Margin of TRU has declined.
TRU's Gross Margin of 60.11% is fine compared to the rest of the industry. TRU outperforms 71.60% of its industry peers.
In the last couple of years the Gross Margin of TRU has declined.
Industry RankSector Rank
OM 16.56%
PM (TTM) N/A
GM 60.11%
OM growth 3Y-6.45%
OM growth 5Y-6.05%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-3.04%
GM growth 5Y-1.73%

3

2. Health

2.1 Basic Checks

TRU has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
The number of shares outstanding for TRU has been increased compared to 1 year ago.
TRU has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, TRU has an improved debt to assets ratio.

2.2 Solvency

An Altman-Z score of 2.21 indicates that TRU is not a great score, but indicates only limited risk for bankruptcy at the moment.
TRU has a worse Altman-Z score (2.21) than 61.73% of its industry peers.
TRU has a debt to FCF ratio of 16.90. This is a negative value and a sign of low solvency as TRU would need 16.90 years to pay back of all of its debts.
With a Debt to FCF ratio value of 16.90, TRU is not doing good in the industry: 74.07% of the companies in the same industry are doing better.
A Debt/Equity ratio of 1.29 is on the high side and indicates that TRU has dependencies on debt financing.
TRU has a worse Debt to Equity ratio (1.29) than 82.72% of its industry peers.
Industry RankSector Rank
Debt/Equity 1.29
Debt/FCF 16.9
Altman-Z 2.21
ROIC/WACC0.57
WACC7.77%

2.3 Liquidity

A Current Ratio of 1.65 indicates that TRU should not have too much problems paying its short term obligations.
TRU has a better Current ratio (1.65) than 60.49% of its industry peers.
TRU has a Quick Ratio of 1.65. This is a normal value and indicates that TRU is financially healthy and should not expect problems in meeting its short term obligations.
The Quick ratio of TRU (1.65) is better than 60.49% of its industry peers.
Industry RankSector Rank
Current Ratio 1.65
Quick Ratio 1.65

5

3. Growth

3.1 Past

The earnings per share for TRU have decreased by 0.00% in the last year.
The Earnings Per Share has been growing slightly by 6.15% on average over the past years.
TRU shows a small growth in Revenue. In the last year, the Revenue has grown by 4.92%.
The Revenue has been growing by 10.58% on average over the past years. This is quite good.
EPS 1Y (TTM)0%
EPS 3Y3.95%
EPS 5Y6.15%
EPS growth Q2Q15%
Revenue 1Y (TTM)4.92%
Revenue growth 3Y14.83%
Revenue growth 5Y10.58%
Revenue growth Q2Q8.6%

3.2 Future

TRU is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 16.48% yearly.
Based on estimates for the next years, TRU will show a quite strong growth in Revenue. The Revenue will grow by 8.01% on average per year.
EPS Next Y10.84%
EPS Next 2Y14.43%
EPS Next 3Y14.96%
EPS Next 5Y16.48%
Revenue Next Year5.62%
Revenue Next 2Y6.83%
Revenue Next 3Y7.42%
Revenue Next 5Y8.01%

3.3 Evolution

When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.

2

4. Valuation

4.1 Price/Earnings Ratio

With a Price/Earnings ratio of 21.95, TRU is valued on the expensive side.
TRU's Price/Earnings ratio is in line with the industry average.
TRU is valuated rather cheaply when we compare the Price/Earnings ratio to 28.52, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 17.36 indicates a rather expensive valuation of TRU.
TRU's Price/Forward Earnings ratio is in line with the industry average.
TRU's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 20.13.
Industry RankSector Rank
PE 21.95
Fwd PE 17.36

4.2 Price Multiples

The rest of the industry has a similar Enterprise Value to EBITDA ratio as TRU.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of TRU indicates a slightly more expensive valuation: TRU is more expensive than 64.20% of the companies listed in the same industry.
Industry RankSector Rank
P/FCF 47.18
EV/EBITDA 17.17

4.3 Compensation for Growth

The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
A more expensive valuation may be justified as TRU's earnings are expected to grow with 14.96% in the coming years.
PEG (NY)2.02
PEG (5Y)3.57
EPS Next 2Y14.43%
EPS Next 3Y14.96%

4

5. Dividend

5.1 Amount

With a yearly dividend of 0.53%, TRU is not a good candidate for dividend investing.
TRU's Dividend Yield is a higher than the industry average which is at 1.99.
With a Dividend Yield of 0.53, TRU pays less dividend than the S&P500 average, which is at 2.32.
Industry RankSector Rank
Dividend Yield 0.53%

5.2 History

On average, the dividend of TRU grows each year by 13.41%, which is quite nice.
TRU has been paying a dividend for over 5 years, so it has already some track record.
As TRU did not decrease their dividend in the past 5 years, we can say the dividend looks stable.
Dividend Growth(5Y)13.41%
Div Incr Years3
Div Non Decr Years5

5.3 Sustainability

The earnings of TRU are negative and hence is the payout ratio. TRU will probably not be able to sustain this dividend level.
TRU's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP-29.84%
EPS Next 2Y14.43%
EPS Next 3Y14.96%

TRANSUNION

NYSE:TRU (5/21/2024, 7:04:00 PM)

After market: 76.62 0 (0%)

76.62

-2.24 (-2.84%)

Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCommercial & Professional Services
GICS IndustryProfessional Services
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap14.88B
Analysts
Price Target
Dividend
Industry RankSector Rank
Dividend Yield 0.53%
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
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PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
Industry RankSector Rank
PE 21.95
Fwd PE 17.36
P/S
P/FCF
P/OCF
P/B
P/tB
EV/EBITDA
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)2.02
PEG (5Y)3.57
Profitability
Industry RankSector Rank
ROA -2.49%
ROE -6.74%
ROCE
ROIC
ROICexc
ROICexgc
OM 16.56%
PM (TTM) N/A
GM 60.11%
FCFM
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.35
Health
Industry RankSector Rank
Debt/Equity 1.29
Debt/FCF
Debt/EBITDA
Cap/Depr
Cap/Sales
Interest Coverage
Cash Conversion
Profit Quality
Current Ratio 1.65
Quick Ratio 1.65
Altman-Z
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)0%
EPS 3Y3.95%
EPS 5Y
EPS growth Q2Q
EPS Next Y10.84%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)4.92%
Revenue growth 3Y14.83%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y