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Equifax Inc. (EFX) is finding new avenues for growth in the international, personal, and commercial solution businesses, while its U.S. consumer information solution business is also showing signs of improvement. The company's growing reliance on subscription revenue provides a steady revenue stream, and the TALX acquisition is accretive to earnings.
However, continued weakness in mortgage activity has resulted in a 7.8% decline in mortgage related revenues in 2007. Thus, we maintain a Hold recommendation on EFX shares.
We believe that the stock will perform in-line with the broader equity market over the near-term. Therefore, our new target price of $36 represents a multiple of 14.2x our 2008 EPS estimate, a discount to the industry mean and S&P 500.
Read the full analyst report on EFX
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