EQUIFAX INC (EFX): what the price assumes

In the published model solve dated 2026-Q2, anchored at $194.35, EQUIFAX INC (EFX) is priced for +23.8% growth. boothcheck publishes no house fair value, target price, or buy/sell rating; individual model outputs and user-controlled scenarios are analytical inputs, not Boothcheck targets. Narrative composed 2026-07-25.

Generated: 2026-08-30 · Source: https://boothcheck.com/report/EFX

Headline

What The Price Assumes (Inversion)

The assumption today's price embeds, recovered by inverting the valuation.

The operating-margin figure is value-band context at year 12: derived from the framework's value band, a separate calculation — not part of the priced-in solve.

Solve inputs: computed at a 9.3% cost of capital with 4% terminal growth over a 5-year stage.

How unusual the bet is: n/a

Valuation X-Ray

Asset, earnings-power and peer-multiple models all land far below the price; ONLY the growth-DCF reaches it. The bet is durable compounding the static frames structurally cannot price (a moat/durability premium).

How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.

Families that justify the price: Growth Families that call it expensive: Asset, Earnings, Relative

The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 7.6%); the inversion above states its own rate.

Per-Model Detail (n=15)

Economic-Unit Decomposition (Sum Of The Parts)

One or more material disclosed units has unresolved economics. Unknown/general is not evidence of homogeneity: segment SOTP is primary but incomplete, consolidated cash flow may remain only a secondary cross-check when every unit shares an enterprise basis, and one sector multiple or target margin is withheld.

No total common-equity value is stated. One or more material units lack a supported unit value. The displayed values are an indicative subtotal; consolidated debt and cash cannot be applied to a fraction of the company.

Solvency

Bullet Takeaways

• Most of the profit sits in one place: Workforce Solutions, the payroll and income records business, earned a 44.9% operating margin on 705.4 million dollars of revenue in the June quarter, roughly double what the credit bureau alongside it manages.
• The clearest risk is written into the annual report, which calls competition in Verification Services highly competitive with low barriers to entry and tells investors to expect U.S. mortgage credit activity in 2026 to run below 2025 levels.
• Two dated events sit ahead: third-quarter revenue guided to a range of 1.680 to 1.710 billion dollars, and the 750 million dollar purchase of Mexican bureau Círculo de Crédito, expected to close in the fourth quarter of 2026.

Bull Case

Take the bear's best card first. Equifax tells investors, in its own annual report, that it expects U.S. mortgage credit activity in 2026 to be below the levels of activity seen in 2025. Mortgage is the single most cyclical input into this business, and a credit bureau whose largest end market is shrinking should be shrinking with it. That is the fear, and it is a reasonable one.

The June quarter says otherwise. U.S. mortgage revenue rose 25% year over year, and inside the credit bureau segment mortgage revenue rose 40%, with management noting the growth came despite higher mortgage rates through the quarter. The mechanism is visible in the older disclosure too, where revenue growth is attributed to higher mortgage related online services due to product pricing and new products rather than to volume. When a company can grow a line by pricing and product content while the underlying transaction count falls, it is not really a cyclical revenue line. It is a toll that gets renegotiated upward.

The profit engine underneath that is a business most people do not think of as a credit bureau at all. Workforce Solutions holds payroll records contributed by employers, and it sells verification of income and employment to lenders, government agencies and recruiters. The filing describes it as the segment enabling customers to verify income, employment, educational history, criminal justice data and related records. The economics are the tell: in the June quarter Workforce Solutions produced 705.4 million dollars of revenue at a 44.9% operating margin, while the U.S. credit bureau produced 611.6 million dollars at 22.5% and the international business 383.1 million dollars at 12.1%. Nearly half of what the largest segment sells drops to operating profit. That is the number that explains the share price.

Nor is the payroll database standing still. Government contract wins and renewals signed in the first half of 2026 totaled about 300 million dollars of annual contract value, which management expects to benefit 2027 and later rather than the current year. Verification revenue grew 7% in the quarter with what the company described as high double digit growth in talent and consumer lending applications. A records database becomes more valuable as more employers contribute to it and more institutions are required to check it, and neither of those trends reverses easily.

The segment margins also put the peer comparison in a different light. Against the data and analytics cohort, Equifax's consolidated operating margin near 17.8% looks thin: VRSK runs about 44.0% on revenue of 3.1023 billion dollars, MCO about 43.5% on 7.873 billion, SPGI about 43.9% on 15.730 billion. But those companies do not carry three segments with a large unallocated corporate layer sitting above them. Workforce Solutions on its own, at 44.9%, sits right alongside them. The bull argument is that as the faster-growing, higher-margin segment takes a bigger share of the whole, the consolidated number moves toward the segment number rather than the reverse.

Capital allocation supports the same direction. In the June quarter the company returned 366 million dollars to shareholders, repurchasing 1.8 million shares, about 1% of those outstanding, for 300 million dollars and paying 66 million dollars in dividends, while signing a 750 million dollar agreement for the fastest-growing credit bureau in Mexico. Buying data assets in a market where the credit file is still being built is the same trade Equifax made decades ago at home, at a much smaller price.

Bear Case

Equifax is priced as though it were one of the great data franchises, and in one segment it is. The problem is that the company you actually buy is not that segment. It is that segment plus a mid-margin domestic credit bureau, plus an international business earning 12.1% operating margins, plus a corporate overhead layer that consumes several hundred million dollars a year before anything reaches the shareholder. The trailing consolidated operating margin comes to about 17.8%. That is roughly where TRU lands, at 17.9% on revenue of 4.7263 billion dollars, and nowhere near VRSK at 44.0% or MCO at 43.5%. The multiple, however, is not priced anywhere near TRU's kind of business.

Work the price backwards and the requirement is specific. At roughly 24 times operating profit, the price embeds something close to 21.6% annual growth in operating income sustained for five years. Keep that approximate; it is one solve under fixed assumptions, and a percentage point of change in the cost of capital moves it by around seven points. But the direction is not in doubt, and neither is the rarity. That multiple sits at the very top of its peer group, well beyond the upper quartile, and of the companies that once ran at that rate, only about a third were still doing so five years later. Revenue guidance for the full year implies growth of roughly 10.5% to 11.6%. Operating profit has to grow at roughly twice that rate for half a decade for the arithmetic to close.

The moat is thinner than the margin suggests, and the strongest evidence is the company's own words. Its annual report states that competition in the Verification Services business, the revenue engine inside its most profitable segment, is highly competitive with low barriers to entry. It also warns that We also compete with several of our third-party data suppliers and intellectual property providers, and that if key data sources withdraw, the products lose their input. A payroll records database is only defensible while employers keep contributing and while no one else assembles the same file. Payroll processors sit closer to that data than Equifax does.

Regulation is the second structural pressure and it points one way. The bureau operates under the Fair Credit Reporting Act with the CFPB holding what the filing calls broad authority over its business, and it flags that compliance costs and exposure could increase materially if the CFPB or other regulators enact new regulations, change existing regulations, modify through supervision or enforcement past regulatory guidance. The company also concedes that demand may fall to the extent the availability of free or less expensive consumer information increases. Data that consumers can get for nothing is difficult to keep selling at a premium.

The 2017 breach is not just history either. The filing discloses that as a result of a prior material cybersecurity incident it lost certain key certifications which caused certain customers and business partners to stop or pause doing business with us, and legal and regulatory accruals connected to that incident still run through the reconciliation between reported and adjusted earnings. For a company whose product is trust in a file about strangers, that is a recurring cost rather than a closed chapter.

The balance sheet does not leave much slack for a stumble. Net debt runs about 6.2 billion dollars against operating profit that covers the interest bill roughly 5.1 times over. That is serviceable rather than comfortable, particularly with 750 million dollars committed to an acquisition and buybacks running at 300 million dollars a quarter. Reported profitability is going the wrong way in the meantime: net income attributable to Equifax fell 4% in the June quarter to 183.9 million dollars, even as revenue rose 11%. Growth that does not reach the bottom line is exactly what a price requiring 21.6% compounding cannot afford.

Valuation

The price works backwards into a single demanding sentence. At about 24 times operating profit, today's quote assumes operating income compounds at roughly 21.6% a year for five years. Treat that as approximate rather than measured; it is one solve, and moving the cost of capital by a percentage point shifts the implied rate by something like seven points. Even allowing for that, the requirement is unusual. The multiple sits at the very top of its peer group, past the upper quartile, and among companies that have grown at that pace, only about 35% kept it up for five years.

The methods split cleanly around that assumption. Only the forward-growth approaches reach the price. Peer multiples land about 38% below it, the asset-value approaches about 149% below, and the earnings-power approaches about 190% below. That is the signature of a durability premium: nothing anchored to today's balance sheet or today's earnings can reach the quote, and the only frames that can are the ones that credit years of compounding in advance. The premium is not a flaw in the static methods. It is the thing being bought.

Where the argument gets concrete is the distance between segment profitability and company profitability. In the June quarter Workforce Solutions ran a 44.9% operating margin, the U.S. bureau 22.5%, and the international business 12.1%. Consolidated, trailing operating margin is about 17.8%, because a large unallocated corporate expense sits above all three. So the "what has to be true" is not that any segment becomes more profitable. It is that revenue compounds fast enough, and the fastest-growing segment takes enough share of the mix, that the gap between 44.9% and 17.8% narrows. Full-year revenue guidance of 6.710 to 6.780 billion dollars implies roughly 10.5% to 11.6% growth. Operating profit has to move at about double that pace.

Against the cohort, the puzzle is the same one from the other side. VRSK earns about 44.0% operating margins on revenue of 3.1023 billion dollars, MCO about 43.5% on 7.873 billion, SPGI about 43.9% on 15.730 billion, and FICO about 50.4% on 2.2558 billion. Equifax's consolidated margin sits with TRU at the bottom of that list. The price does not.

Leverage bounds how long the market will wait. Net debt runs about 6.2 billion dollars, with operating profit covering the interest bill about 5.1 times over, and the company has committed 750 million dollars to an acquisition expected to close late in 2026 while repurchasing shares at roughly 300 million dollars a quarter. The share count has drifted down about 0.6% a year over four years, so buybacks are offsetting issuance and a little more rather than transforming the per-share arithmetic. The number that decides this valuation is not on the balance sheet at all. It is whether payroll records keep compounding at a rate the rest of the company cannot.

Catalysts

Second-quarter results, reported July 21, 2026, gave the bull case its strongest recent evidence and the bear case its clearest one. Revenue reached 1,700.1 million dollars, up 11%, with U.S. mortgage revenue up 25% and credit bureau mortgage revenue up 40%. Net income attributable to Equifax fell 4% to 183.9 million dollars over the same span, so the growth did not reach the reported bottom line. Both facts came from the same release.

Guidance sets the near-term bar. The company pointed to third-quarter revenue of 1.680 to 1.710 billion dollars and full-year revenue of 6.710 to 6.780 billion dollars, with full-year adjusted earnings per share, the company's own supplemental measure, guided to a range of 8.39 to 8.69 dollars. Management also doubled its 2026 to 2028 cost reduction target from artificial intelligence deployment to 150 million dollars. That target is a margin story rather than a revenue one, and it lands in exactly the corporate expense layer that separates segment profitability from company profitability.

Two structural items are dated. Equifax signed a definitive agreement to buy Círculo de Crédito, described as the fastest growing credit bureau in Mexico, for an enterprise value of 750 million dollars, with closing expected in the fourth quarter of 2026. And in Workforce Solutions, government contract wins and renewals signed during the first half of 2026 came to about 300 million dollars of annual contract value, which management expects to benefit 2027 and beyond rather than the current year. Those contracts are the closest thing to visible forward revenue this business discloses, and they are the reason the segment's growth rate matters more than any single quarter's mortgage print.

Peer Cohorts (Per Segment, With Filing Citations)

Workforce Solutions (reported)

• TRU (TransUnion)
• FY2025 10-K: …consumer credit data and any additional third-party data to support a wide range of analytics use cases. This can all be done without requiring the customer's data to leave their environment, increasing speed to actionable insights in a privacy compliant manner. 7 Table of Contents Further Penetrate Existing Industry…
• FY2025 10-K: Analytics, Inc. in the Insurance vertical, and with LiveRamp and Experian in the marketing solutions space. We also compete with LifeLock as well as personal finance websites in the Consumer Interactive vertical, some of whom offer free credit information. In our International segment, we generally compete with…
• FICO (Fair Isaac Corp)
• FY2025 10-K: …plans with significant company subsidies to offset premiums, retirement plans with a competitive company match to encourage participation and flexible paid-time-off programs including vacation, sick time and disability time. We have paid Maternity and Parental Leave benefits totaling up to 12 weeks, and we have…
• FY2025 10-K: …during fiscal 2025. Our Board of Directors (our "Board") and executive leadership team believe that our people are vital to our success. The Leadership Development and Compensation Committee (the "LDCC") of our Board oversees all human capital management policies, programs, and strategies, including but not limited…
• VRSK (Verisk Analytics, Inc.)
• FY2025 10-K: …we play a critical role in assisting and protecting all stakeholders, including Medicare and its beneficiaries. Our comprehensive workers' compensation state reporting helps customers meet the very complex compliance requirements for reporting to states and other government related agencies and entities through an…
• FY2025 10-K: Our advanced digital media forensics can detect suspicious claim-related photos, and our customers can flag stolen and synthetic identities in the database to help subscribers deter that type of fraud. We also provide accurate person and vehicle coverage details at first notice of loss, including verified registered…
• SPGI (S&P Global Inc.)
• FY2025 10-K: …in Note 12 - Segment and Geographic Information to the consolidated financial statements under Item 8, Consolidated Financial Statements and Supplementary Data , in this Annual Report on Form 10-K. Human Capital As of December 31, 2025, we had approximately 44,500 permanent employees located worldwide, including…
• FY2025 10-K: …• We offer competitive salary and benefit packages to attract and retain the quality employees required to grow and expand our businesses. Compensation and benefits costs are influenced by general economic factors, including but not limited to changes in the cost of health insurance, retirement benefits, inflation,…
• MCO (Moody’s Corporation)
• FY2025 10-K: …license fees and revenue from software implementation services, risk management advisory projects, and training and certification services. For MIS (excluding MIS Other), represents the initial rating of a new debt issuance as well as other one-time fees. For MIS Other, represents revenue from professional services…
• FY2025 10-K: …effectiveness, connection, enablement and empowerment and well-being. Managers are accountable for identifying opportunity areas and taking targeted actions based on survey results. The feedback received through the BES is used as a vital input into making decisions to improve employee experience and retention. As we…
• MORN (MORNINGSTAR, INC.)
• FY2025 10-K: …fees). In both cases, pricing varies based on the level of distribution, the type of user, and the specific indexes licensed. In addition, Morningstar Indexes offers index calculation and administration services through its index services. 13 Table of Contents Our Strategy Our strategy is to deliver insights and…
• FY2025 10-K: …own internal tools and attempting to bring their advisors' practice management tools in-house, as with Pershing's Wove platform. Revenue Model Morningstar Advisor Workstation generates license-based revenue and is primarily sold through an enterprise contract for retail advisors, which allows them to build and…

U.S. Information Solutions (reported)

• TRU (TransUnion)
• FY2025 10-K: Analytics, Inc. in the Insurance vertical, and with LiveRamp and Experian in the marketing solutions space. We also compete with LifeLock as well as personal finance websites in the Consumer Interactive vertical, some of whom offer free credit information. In our International segment, we generally compete with…
• FY2025 10-K: …and gaining new customers. We have a diversified portfolio across the markets we serve, reducing our exposure to cyclical trends in any particular vertical, product or geography. We operate primarily on contributory data models in which we typically obtain updated information at little or no cost. 1 Table of Contents…
• FICO (Fair Isaac Corp)
• FY2025 10-K: …risk relationship as standard FICO ® Scores, enhancing their compatibility with existing credit underwriting systems and models. Outside the U.S., we offer FICO ® Scores for consumer loans, and in some cases for small and medium business loans. These scores are typically sold to end-users through consumer reporting…
• FY2025 10-K: …omni-channel communication, risk assessment, and fraud detection and prevention. Key FICO solutions currently offered include: • FICO ® Fraud Solutions empower organizations to safeguard the business and their customers from payments fraud and application fraud. Leveraging advanced analytic capabilities on a large…
• SPGI (S&P Global Inc.)
• FY2025 10-K: …For a further discussion of competitive and other risks inherent in our Indices business, see Item 1A, Risk Factors , in this Annual Report on Form 10-K. For a further discussion of the legal and regulatory environment in our Indices business, see Note 13 - Commitments and Contingencies to the consolidated financial…
• FY2025 10-K: …traders and intermediaries within energy, chemicals, shipping, metals, carbon and agriculture; and the automotive markets include manufacturers, suppliers, dealerships, service shops and customers. We serve our global customers through a broad range of products and services available through both third-party and…
• MCO (Moody’s Corporation)
• FY2025 10-K: …ICT Information, communication and technology IRS Internal Revenue Service ISO 27001 An international standard to manage information security JPY Japanese yen KMV KMV LLC and KMV Corporation ("KMV"); a provider of market-based quantitative services for banks and investors in credit-sensitive assets acquired by…
• FY2025 10-K: …license fees and revenue from software implementation services, risk management advisory projects, and training and certification services. For MIS (excluding MIS Other), represents the initial rating of a new debt issuance as well as other one-time fees. For MIS Other, represents revenue from professional services…
• VRSK (Verisk Analytics, Inc.)
• FY2025 10-K: …Analytics Solutions We gather information on individual properties, vehicles and communities providing the breadth and depth of data and analytics needed to support our clients as they evaluate, segment, and price personal and commercial insurance, as well as commercial liability insurance, throughout the policy…
• FY2025 10-K: …insurers in underwriting and rating-that is, measuring and selecting risks and pricing coverage appropriately to help ensure fairness to the consumer and a reasonable return for the insurer. Our solutions apply advanced predictive analytics to our deep reservoir of data and information to gauge the degree and cost of…
• FDS (FACTSET RESEARCH SYSTEMS INC.)
• FY2025 10-K: …Securities Identification Number ("ISIN") identifiers in the U.S. and as a substitute ISIN agency for more than 30 other countries. Business Strategy We strive to be a trusted enterprise partner and service provider to our clients across the financial services spectrum, delivering relevant intelligence, insights and…
• FY2025 10-K: …clients' internal teams to support data, performance, risk and reporting workflows. We drive our business based on a detailed understanding of our clients' workflows, which helps us to solve their most complex challenges. We provide financial data and market intelligence on securities, companies, industries and…
• MORN (MORNINGSTAR, INC.)
• FY2025 10-K: …its revenue in 2025. We estimate that our annual revenue renewal rate for Morningstar Sustainalytics' license-based products was approximately 93% in both 2024 and 2025 reflecting the revised renewal rate methodology. Morningstar Indexes offers a broad range of market indexes that can be used as performance…
• FY2025 10-K: …known. We believe the following critical accounting policies reflect the significant judgments and estimates used in the preparation of our Consolidated Financial Statements: Revenue Recognition A majority of our revenue comes from the sale of subscriptions for data, software, and Internet-based products and…

Core business (reported)

• TRU (TransUnion)
• FY2025 10-K: …affected. Our largest customers, and therefore our business and revenues, are influenced by macroeconomic conditions and are impacted by the availability of credit, the level and volatility of interest rates, inflation, employment levels, consumer confidence and housing demand. In addition, a significant amount of…
• FY2025 10-K: …primarily through our own sales force. We have dedicated sales teams for our largest customers focused by industry group and geography. These dedicated sales teams provide strategic account management and direct support to customers. We use shared sales teams to sell our services to mid-size customers. Smaller…
• SPGI (S&P Global Inc.)
• FY2025 10-K: …banks, private equity and technology-led companies that are adding content and analytics capabilities to their core businesses. • The competitive landscape also experiences consolidation in the form of mergers and acquisitions, joint ventures or strategic partnerships, which results in competitors that are better…
• FY2025 10-K: …For a further discussion of competitive and other risks inherent in our Indices business, see Item 1A, Risk Factors , in this Annual Report on Form 10-K. For a further discussion of the legal and regulatory environment in our Indices business, see Note 13 - Commitments and Contingencies to the consolidated financial…
• MCO (Moody’s Corporation)
• FY2025 10-K: . and worldwide and on the Company's own operations and personnel; - other matters that could affect the volume of debt and other securities issued in domestic and/or global capital markets, including regulation, increased utilization of technologies that have the potential to intensify competition and accelerate…
• FY2025 10-K: …payable at rates that are based on an adjusted term SOFR Rate plus a premium that can range from 80.5 BPS to 122.5 BPS, depending on the Company's index debt ratings, as set forth in the 2024 Credit Facility. The Company also has the option to choose other rates, such as those based on adjusted Daily Simple SOFR or…
• VRSK (Verisk Analytics, Inc.)
• FY2025 10-K: …business in 2016 and our specialized markets business in 2022, a net gain on the early extinguishment of debt in the prior year, the amortization of deferred issuance costs and original issuance discounts and redemption premium accrual in 2025 associated with the termination of the 2030 Senior Notes, 2036 Senior…
• FY2025 10-K: …from time to time, these contracts may be subject to modifications, impacting the timing of satisfying the performance obligations. These performance obligations, which are expected to be satisfied within one year, comprised approximately 99 % and 98 % of the balance as of December 31, 2025 and 2024 , respectively.…
• FICO (Fair Isaac Corp)
• FY2025 10-K: …our products and services compete favorably with respect to these factors, we may not be able to maintain our competitive position against current and future competitors. 8 Table of Contents Scores In our Scores segment, we compete with both outside suppliers and in-house analytics. Primary competitors among outside…
• FY2025 10-K: …conditions, including, for example, the volume of transactions in the U.S. mortgage and credit card markets, which account for a significant portion of the revenues in our Scores segment. We also derive a substantial portion of our Scores segment revenues and operating income from our contracts with the three major…
• FDS (FACTSET RESEARCH SYSTEMS INC.)
• FY2025 10-K: …acquisition-related revenues and a 0.2% net increase from foreign currency exchange rate fluctuations. The increase in revenues was mainly driven by data solutions, workstations and, to a lesser extent, front office solutions. Operating Expenses Principal Operating Expenses Cost of services is mainly comprised of…
• FY2025 10-K: …the prior year, partially offset by higher employee compensation costs and professional fees in the current year. When expressed as a percentage of revenues: • The charges related to the Sales Tax Dispute recorded in the prior year decreased SG&A by 240 basis points. Refer to Part II, Item 8. Note 12, Commitments and…
• MORN (MORNINGSTAR, INC.)
• FY2025 10-K: …operating decision maker (CODM) in deciding how to allocate resources and in assessing performance. Aggregation of similar operating segments into a single reportable segment is permitted if the businesses have similar economic characteristics and meet established qualitative criteria. We have seven operating…
• FY2025 10-K: …revenue renewal rate for PitchBook platform and direct data product combined was approximately 103%, compared with 108% in 2024. The decline primarily reflected softness in our corporate client segment, including higher churn and lower expansion activity, as well as reduced expansion activity in our core client…

Methodology Note

• Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
• Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
• Economic-unit decomposition (SOTP): each disclosed business unit is assigned its native valuation basis before any multiple is applied. Operating units are valued on enterprise value; funded financial units are valued on their own common equity, because their borrowings fund earning assets rather than levering the parent. A company total is stated only once every material unit carries a supported value and the parent capital bridge reconciles.
• Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
• Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.

Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.