Has Target (TGT) Outpaced Other Retail-Wholesale Stocks This Year?
A wise investment decision involves buying well-performing stocks at the right time while selling those that are at risk. A rise in share price and strong fundamentals signal a stock’s bullish run.
TransUnion TRU, a business-information services company, performed extremely well over the past year and has the potential to carry the momentum forward. Therefore, if you have not taken advantage of the share price appreciation yet, it’s time you add the stock to your portfolio.
What Makes TransUnionan Attractive Pick?
An Outperformer: A glimpse of the company’s price trend reveals that the stock has had an impressive run on the bourse over the past year. TransUnion has returned 49.5%, which compared favorably with the industry’s gain of 26.4%.
Northward Estimate Revisions: Nine estimates for the current year moved north over the past 60 days versus one southward revisions, reflecting analysts’ confidence in the company. Over the same period, the Zacks Consensus Estimate for 2018 increased 6.5%.
Positive Earnings Surprise History: TransUnion has an impressive earnings surprise history. The company outpaced the consensus mark in each of the trailing four quarters, delivering a positive average earnings surprise of 5.2%.
Strong Growth Prospects: The Zacks Consensus Estimate for 2018 earnings is pegged at $2.3, reflecting year-over-year growth of 23%. Moreover, earnings are expected to register 12% growth in 2019. The stock has a long-term expected earnings growth rate of 10% and a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Robust Growth Factors: TransUnion serves a broad range of customers across multiple geographies and verticals, and boasts over 35 million customers. The company has an attractive business model with highly recurring and diversified revenue streams, significant operating leverage, low capital requirements and strong and stable cash flows.
TransUnion Revenue (TTM)
TransUnion Revenue (TTM) | TransUnion Quote
In addition, the inherent nature and significance of its solutions in customers’ decision-making endow it with high customer retention and revenue visibility. Impressively, TransUnion deals with all the 10 largest U.S. banks, the top 5 credit card issuers, the biggest 25 auto lenders and thousands of healthcare providers and federal, state and local government agencies.
Furthermore, the company’s addressable market includes the burgeoning Big Data and analytics market, which is expanding at a rapid pace. Numerous underlying trends are supporting this market growth, including the creation of massive amounts of data; advances in technology and analytics that allow data to be processed more swiftly and efficiently; and mounting demand for these business insights across industries and geographies.
Per a research firm, IDC, global spending on Big Data and analytics services is likely to witness a compound annual growth rate (CAGR) of 11.9% and reach $210 billion in 2020. Additionally, in order to capitalize on the immense growth potential in this market, TransUnion has leveraged its next-generation technology to strengthen the company’s analytics capabilities and further expanded its database. This, in turn, should enable TransUnion to expand its business and improve cost structure.
Other Stocks to Consider
Some other top-ranked stocks in the broader Business Services sector include CRA International CRAI, FTI Consulting FCN and NV5 Global NVEE, each sporting a Zacks Rank of 1.
In the trailing four quarters, CRA International, FTI Consulting and NV5 Globalhave delivered a positive earnings surprise of 28%, 6.1% and 5.8%, respectively.
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