TRANSUNION (TRU) Stock Fundamental Analysis
NYSE:TRU - New York Stock Exchange, Inc. - US89400J1079 - Common Stock - Currency: USD
We assign a fundamental rating of 4 out of 10 to TRU. TRU was compared to 82 industry peers in the Professional Services industry. Both the profitability and the financial health of TRU get a neutral evaluation. Nothing too spectacular is happening here. While showing a medium growth rate, TRU is valued expensive at the moment.
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.
Each year in the past 5 years TRU had a positive operating cash flow.
1.2 Ratios
TRU's Return On Assets of 3.35% is in line compared to the rest of the industry. TRU outperforms 53.66% of its industry peers.
TRU's Return On Equity of 8.37% is in line compared to the rest of the industry. TRU outperforms 53.66% of its industry peers.
The Return On Invested Capital of TRU (6.09%) is comparable to the rest of the industry.
The Average Return On Invested Capital over the past 3 years for TRU is significantly below the industry average of 12.28%.
The last Return On Invested Capital (6.09%) for TRU is above the 3 year average (4.87%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.35% | ||
| ROE | 8.37% | ||
| ROIC | 6.09% |
ROA(3y)1.01%
ROA(5y)3.74%
ROE(3y)2.69%
ROE(5y)11.41%
ROIC(3y)4.87%
ROIC(5y)4.92%
1.3 Margins
TRU has a better Profit Margin (8.63%) than 79.27% of its industry peers.
In the last couple of years the Profit Margin of TRU has declined.
Looking at the Operating Margin, with a value of 19.08%, TRU belongs to the top of the industry, outperforming 85.37% of the companies in the same industry.
In the last couple of years the Operating Margin of TRU has declined.
TRU has a better Gross Margin (59.78%) than 73.17% of its industry peers.
In the last couple of years the Gross Margin of TRU has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.08% | ||
| PM (TTM) | 8.63% | ||
| GM | 59.78% |
OM growth 3Y-7.12%
OM growth 5Y-4.43%
PM growth 3Y-47.46%
PM growth 5Y-13.56%
GM growth 3Y-3.37%
GM growth 5Y-2.27%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so TRU is destroying value.
TRU has more shares outstanding than it did 1 year ago.
Compared to 5 years ago, TRU has more shares outstanding
Compared to 1 year ago, TRU has an improved debt to assets ratio.
2.2 Solvency
TRU has an Altman-Z score of 2.72. This is not the best score and indicates that TRU is in the grey zone with still only limited risk for bankruptcy at the moment.
The Altman-Z score of TRU (2.72) is comparable to the rest of the industry.
The Debt to FCF ratio of TRU is 10.08, which is on the high side as it means it would take TRU, 10.08 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of TRU (10.08) is comparable to the rest of the industry.
TRU has a Debt/Equity ratio of 1.15. This is a high value indicating a heavy dependency on external financing.
The Debt to Equity ratio of TRU (1.15) is worse than 74.39% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.15 | ||
| Debt/FCF | 10.08 | ||
| Altman-Z | 2.72 |
ROIC/WACC0.75
WACC8.12%
2.3 Liquidity
TRU has a Current Ratio of 2.05. This indicates that TRU is financially healthy and has no problem in meeting its short term obligations.
The Current ratio of TRU (2.05) is better than 75.61% of its industry peers.
TRU has a Quick Ratio of 2.05. This indicates that TRU is financially healthy and has no problem in meeting its short term obligations.
The Quick ratio of TRU (2.05) is better than 75.61% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.05 | ||
| Quick Ratio | 2.05 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 16.05% over the past year.
The Earnings Per Share has been growing slightly by 6.96% on average over the past years.
The Revenue has grown by 8.85% in the past year. This is quite good.
The Revenue has been growing by 11.18% on average over the past years. This is quite good.
EPS 1Y (TTM)16.05%
EPS 3Y2.04%
EPS 5Y6.96%
EPS Q2Q%14.13%
Revenue 1Y (TTM)8.85%
Revenue growth 3Y12.22%
Revenue growth 5Y11.18%
Sales Q2Q%7.3%
3.2 Future
Based on estimates for the next years, TRU will show a quite strong growth in Earnings Per Share. The EPS will grow by 9.25% on average per year.
The Revenue is expected to grow by 7.01% on average over the next years.
EPS Next Y6.07%
EPS Next 2Y10.84%
EPS Next 3Y14.03%
EPS Next 5Y9.25%
Revenue Next Year5.69%
Revenue Next 2Y7.31%
Revenue Next 3Y8.96%
Revenue Next 5Y7.01%
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.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 22.78, TRU is valued on the expensive side.
TRU's Price/Earnings is on the same level as the industry average.
The average S&P500 Price/Earnings ratio is at 27.46. TRU is around the same levels.
TRU is valuated rather expensively with a Price/Forward Earnings ratio of 19.16.
The rest of the industry has a similar Price/Forward Earnings ratio as TRU.
TRU is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 36.44, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.78 | ||
| Fwd PE | 19.16 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of TRU is on the same level as its industry peers.
TRU's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 35.35 | ||
| EV/EBITDA | 16.81 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates TRU does not grow enough to justify the current Price/Earnings ratio.
TRU's earnings are expected to grow with 14.03% in the coming years. This may justify a more expensive valuation.
PEG (NY)3.76
PEG (5Y)3.27
EPS Next 2Y10.84%
EPS Next 3Y14.03%
5. Dividend
5.1 Amount
With a yearly dividend of 0.49%, TRU is not a good candidate for dividend investing.
TRU's Dividend Yield is a higher than the industry average which is at 2.11.
With a Dividend Yield of 0.49, TRU pays less dividend than the S&P500 average, which is at 2.34.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.49% |
5.2 History
The dividend of TRU is nicely growing with an annual growth rate of 7.03%!
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)7.03%
Div Incr Years0
Div Non Decr Years6
5.3 Sustainability
23.01% of the earnings are spent on dividend by TRU. This is a low number and sustainable payout ratio.
The dividend of TRU is growing, but earnings are growing more, so the dividend growth is sustainable.
DP23.01%
EPS Next 2Y10.84%
EPS Next 3Y14.03%
92.25
-1.36 (-1.45%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCommercial & Professional Services
GICS IndustryProfessional Services
Earnings (Last)
Earnings (Next)
Inst Owners100.92%
Inst Owner Change-0.17%
Ins Owners0.35%
Ins Owner Change17.34%
Market Cap18.00B
Analysts80
Price Target110.88 (20.2%)
Short Float %2.56%
Short Ratio2.36
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.49% |
Yearly Dividend0.43
Dividend Growth(5Y)7.03%
DP23.01%
Div Incr Years0
Div Non Decr Years6
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)3.48%
Min EPS beat(2)-0.09%
Max EPS beat(2)7.06%
EPS beat(4)3
Avg EPS beat(4)2.36%
Min EPS beat(4)-0.09%
Max EPS beat(4)7.06%
EPS beat(8)6
Avg EPS beat(8)4.11%
EPS beat(12)8
Avg EPS beat(12)2.94%
EPS beat(16)10
Avg EPS beat(16)2.19%
Revenue beat(2)1
Avg Revenue beat(2)0.62%
Min Revenue beat(2)-0.02%
Max Revenue beat(2)1.27%
Revenue beat(4)3
Avg Revenue beat(4)0.78%
Min Revenue beat(4)-0.02%
Max Revenue beat(4)1.31%
Revenue beat(8)6
Avg Revenue beat(8)0.78%
Revenue beat(12)7
Avg Revenue beat(12)0.19%
Revenue beat(16)8
Avg Revenue beat(16)-1.59%
PT rev (1m)3.41%
PT rev (3m)-5.25%
EPS NQ rev (1m)0.25%
EPS NQ rev (3m)-2.8%
EPS NY rev (1m)0.1%
EPS NY rev (3m)1.18%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.18%
Revenue NY rev (1m)0.02%
Revenue NY rev (3m)0.52%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.78 | ||
| Fwd PE | 19.16 | ||
| P/S | 4.23 | ||
| P/FCF | 35.35 | ||
| P/OCF | 21.66 | ||
| P/B | 4.1 | ||
| P/tB | N/A | ||
| EV/EBITDA | 16.81 |
EPS(TTM)4.05
EY4.39%
EPS(NY)4.82
Fwd EY5.22%
FCF(TTM)2.61
FCFY2.83%
OCF(TTM)4.26
OCFY4.62%
SpS21.83
BVpS22.48
TBVpS-20.41
PEG (NY)3.76
PEG (5Y)3.27
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.35% | ||
| ROE | 8.37% | ||
| ROCE | 8.08% | ||
| ROIC | 6.09% | ||
| ROICexc | 6.48% | ||
| ROICexgc | 56.72% | ||
| OM | 19.08% | ||
| PM (TTM) | 8.63% | ||
| GM | 59.78% | ||
| FCFM | 11.96% |
ROA(3y)1.01%
ROA(5y)3.74%
ROE(3y)2.69%
ROE(5y)11.41%
ROIC(3y)4.87%
ROIC(5y)4.92%
ROICexc(3y)5.17%
ROICexc(5y)5.36%
ROICexgc(3y)55.44%
ROICexgc(5y)115.16%
ROCE(3y)6.46%
ROCE(5y)6.53%
ROICexcg growth 3Y-43.22%
ROICexcg growth 5Y-5.67%
ROICexc growth 3Y4.94%
ROICexc growth 5Y-1.8%
OM growth 3Y-7.12%
OM growth 5Y-4.43%
PM growth 3Y-47.46%
PM growth 5Y-13.56%
GM growth 3Y-3.37%
GM growth 5Y-2.27%
F-Score7
Asset Turnover0.39
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.15 | ||
| Debt/FCF | 10.08 | ||
| Debt/EBITDA | 3.73 | ||
| Cap/Depr | 59.3% | ||
| Cap/Sales | 7.56% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 61.31% | ||
| Profit Quality | 138.63% | ||
| Current Ratio | 2.05 | ||
| Quick Ratio | 2.05 | ||
| Altman-Z | 2.72 |
F-Score7
WACC8.12%
ROIC/WACC0.75
Cap/Depr(3y)58.48%
Cap/Depr(5y)58.62%
Cap/Sales(3y)7.9%
Cap/Sales(5y)7.95%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)16.05%
EPS 3Y2.04%
EPS 5Y6.96%
EPS Q2Q%14.13%
EPS Next Y6.07%
EPS Next 2Y10.84%
EPS Next 3Y14.03%
EPS Next 5Y9.25%
Revenue 1Y (TTM)8.85%
Revenue growth 3Y12.22%
Revenue growth 5Y11.18%
Sales Q2Q%7.3%
Revenue Next Year5.69%
Revenue Next 2Y7.31%
Revenue Next 3Y8.96%
Revenue Next 5Y7.01%
EBIT growth 1Y25.4%
EBIT growth 3Y4.23%
EBIT growth 5Y6.25%
EBIT Next Year118.4%
EBIT Next 3Y40.66%
EBIT Next 5Y26.01%
FCF growth 1Y788.66%
FCF growth 3Y-4%
FCF growth 5Y-2.22%
OCF growth 1Y128.67%
OCF growth 3Y0.99%
OCF growth 5Y1.4%