TransUnion (TRU): what the price assumes

In the published model solve dated 2026-Q2, anchored at $80.02, TransUnion (TRU) is priced for today's economics sustained for ~5.8 years. 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 2026-07-11.

Generated: 2026-08-10 · Exported: 2026-08-12 · Source: https://boothcheck.com/report/TRU

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 10% cost of capital; growth searched up to the 25% self-funding ceiling; each 1pp moves the implied horizon ~1.7 years.

How unusual the bet is: high

Valuation X-Ray

The price is justified by relative-multiple and growth-DCF; asset-based/earnings-power land below the price.

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: Relative, Growth Families that call it expensive: Asset, Earnings

The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 7.0%); the inversion above states its own rate.

Per-Model Detail (n=17)

Solvency

Bullet Takeaways

• TransUnion is one of three companies holding the U.S. consumer credit file, now spread across nine reported markets from U.S. financial services to India, and it grew revenue 13.7% year over year in the March quarter while raising full-year guidance.
• The price asks for a lot of future: at about 22x operating income the market embeds roughly 23.5% annual operating growth for five years, a pace only about 32% of comparable fast growers sustained, and operating income actually fell 3.8% year over year in the latest quarter.
• Watch the mortgage score war, where TransUnion cut VantageScore 4.0 to $0.99 per score as the government-sponsored entities open mortgage lending to dual score models, a shift the 10-K flags in noting that "the Federal Housing Finance Agency and various government sponsored entities continue to evaluate permitting mortgage" scoring changes.

Bull Case

Watch what management did with the cash this year, because it is doing three things at once and funding all of them internally. Over the trailing year TransUnion returned $401.6 million to shareholders, $308.7 million of buybacks, nearly 44% of net income, plus a dividend just raised to $0.50 annualized at a mere 13.8% payout. Simultaneously it bought growth: consolidating a 94% stake in Trans Union de Mexico and acquiring a mobile messaging business to extend its communications offerings. Trailing free cash flow of $700 million, converting 99% of net income, pays for the entire program, and guidance calls for free cash flow conversion of 90% or better this year with capital spending near 6% of revenue. This is what a data business with real operating leverage looks like when it stops integrating and starts compounding.

The growth is broad, not borrowed. First-quarter revenue rose 13.7% year over year to $1.25 billion, exceeding guidance on revenue, adjusted EBITDA, and adjusted earnings, led by U.S. financial services strength plus the Mexico consolidation, and management raised full-year adjusted earnings guidance to $4.68 to $4.75 per share, up 9% to 11%. The moat underneath is the credit file itself, one of three nationwide consumer databases, which the 10-K extends into adjacent products that let customers combine "consumer credit data and any additional third-party data to support a wide range of analytics use cases" without data leaving their environment. And in mortgage, TransUnion is playing offense: cutting VantageScore 4.0, which the bureaus jointly own, to $0.99 per score as it wins approval for Fannie Mae, Freddie Mac, and FHA loans, projecting more than $900 million of industry savings and positioning to take score economics from FICO.

The international footprint is the part the market rarely prices. Nine reported markets spanning Canada, Latin America, the U.K., Africa, India, and Asia Pacific give TransUnion the emerging-credit-penetration story its U.S.-only peers lack; India, the flagship, grew in local currency on "new business wins and higher commercial volumes" per the 10-K even as currency translation masked it. Meanwhile the price requires no margin heroics at all: the business needs only about an 8.7% long-run operating margin to justify today's quote against the roughly 17.9% it already earns. The bet is on growth persistence, and this quarter's 13.7% is what persistence looks like.

Bear Case

Credit bureaus sell into a lending cycle, and the question a buyer at this price must answer is which part of today's growth is franchise and which part is cycle. First-quarter strength was led by U.S. financial services, the most volume-sensitive slice of the business, riding a consumer-lending upswing. The price leaves no room for the cycle to turn: at about 22x operating income, it embeds roughly 23.5% annual operating growth for five years, a pace only about 32% of comparable fast growers have historically sustained, and the awkward fact beneath the revenue beat is that operating income fell 3.8% year over year in the March quarter. Revenue growing 14% while operating profit shrinks is what investment-heavy expansion looks like; it is not yet what 23% compounding looks like.

The industry's pricing structure is being renegotiated in public. All three bureaus have slashed VantageScore 4.0 to a dollar or less per mortgage score and are giving it away free with FICO purchases, a war aimed at FICO's royalty but one that establishes, in writing, that credit scores can cost $0.99. The government-sponsored entities' move to dual score models and away from mandatory tri-merge files, an evolution the 10-K itself flags in noting that "the Federal Housing Finance Agency and various government sponsored entities continue to evaluate permitting mortgage" scoring changes, could shrink the number of reports pulled per mortgage. Layer on the standing regulatory exposure, with the filing warning of the CFPB's capacity for "additional enforcement actions" and new or reinterpreted regulations, and the toll-booth economics the multiple assumes look less settled than at any point in a decade.

The balance sheet and the earnings print both need asterisks. Debt runs at 1.14x equity and is not declining, the composite solvency gauge sits in its grey zone, and the headline first-quarter earnings surge, net income up 168% while operating income fell, was a below-the-line event, not operating power. Methods anchored to demonstrated earnings power put the price at 2.9x what current profits support, and asset-based reads at 1.9x. At 20.7x trailing GAAP earnings against a 12x sector median, the stock only works on the forward-crediting families' math, which requires the lending cycle, the score war, and the regulators all to cooperate for five years.

Valuation

The bet inside $74.95 (July 10, 2026) is aggressive on growth and modest on everything else. Unwinding the price gives about 22x operating income, embedding roughly 23.5% annual operating-income growth for five years, a pace within what TransUnion has recently delivered in bursts but one that only about 32% of comparable fast growers sustained that long. The margin side asks nothing: about an 8.7% long-run operating margin justifies the price against the roughly 17.9% earned today. This is a duration-of-growth bet, pure and simple, and the framework labels the embedded assumption elevated relative to what fundamentals comfortably support.

The methods split along the forward-versus-demonstrated line. Peer multiples and growth-based cash-flow methods both land about 20% above the price, supporting it; earnings-power methods put the price at 2.9x what trailing profits defend, and asset-based methods at 1.9x. One reconciling clause keeps the earnings bases straight: the trailing GAAP multiple of 20.7x sits on earnings that include a large below-the-line gain in the March quarter, while the company's guided adjusted earnings of $4.68 to $4.75 imply a forward multiple in the mid-teens on that adjusted basis; the two describe different earnings definitions, not a contradiction. The revenue inputs underneath are disclosed cleanly, including the international mix where the 10-K reports India revenue down 1.9% on currency while "local currency revenue increased" on new business wins.

Solvency is manageable rather than pristine: leverage is moderate and well covered, though debt at 1.14x equity is not falling, and the company generated positive free cash flow in all four trailing quarters, $700 million in total, converting 99% of net income. Capital return runs at $401.6 million a year with a 13.8% dividend payout leaving ample retention. The decisive variable is the one the inversion isolates: whether a credit-data franchise riding a lending upswing, a score-pricing war, and two fresh acquisitions can hold operating growth anywhere near what the price already assumes.

Catalysts

The score war has dates attached. VantageScore 4.0 became officially approved for Fannie Mae, Freddie Mac, and FHA loans as of June 2026, the GSEs published historical credit-score data for FICO 10T and VantageScore 4.0 on July 1, and TransUnion cut its VantageScore 4.0 price to $0.99 per mortgage score, free with a FICO purchase through 2026. Adoption is the number to watch: classic FICO on tri-merge files still dominates closings, so each quarter's evidence of lenders actually switching determines whether the bureaus' pricing offensive converts into score share or merely compresses industry economics. TransUnion projects more than $900 million in potential industry savings from the shift.

The earnings calendar carries raised expectations. First-quarter results beat guidance across revenue, adjusted EBITDA, and adjusted earnings, with revenue up 14% to $1,246 million, adjusted EBITDA up 10% to $438 million at a 35.2% margin, and adjusted earnings per share of $1.18, up 12%. Full-year guidance now calls for adjusted earnings of $4.68 to $4.75, up 9% to 11%, framed by management as conservative amid macro uncertainty. Integration of the two completed acquisitions, the consolidated 94% stake in Trans Union de Mexico and the mobile-messaging business, feeds the international and communications lines through year-end, and the second-quarter print in late July tests whether U.S. financial services volume strength, the quarter's main engine, persisted through the spring lending season.

Peer Cohorts (Per Segment, With Filing Citations)

U.S. Markets (reported)

• EFX (EQUIFAX INC)
• FY2025 10-K: .4 Second Supplemental Indenture, dated as of May 12, 2016, between Equifax Inc. and U.S. Bank National Association, as Trustee, including the form of 2026 Note as Exhibit A (incorporated by reference to Exhibit 4.3 to Equifax's Form 8-K filed May 12, 2016). 4.5 Eighth Supplemental Indenture, dated as of April 27,…
• FY2025 10-K: …us-gaap:OtherPostretirementBenefitPlansDefinedBenefitMember us-gaap:DefinedBenefitPlanRealEstateMember 2025-12-31 0000033185 us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel12And3Member us-gaap:OtherPostretirementBenefitPlansDefinedBenefitMember us-gaap:DefinedBenefitPlanCashMember 2025-12-31…
• FICO (Fair Isaac Corp)
• FY2025 10-K: …1995-June 2007, various positions, including VP Sales & Operations and VP Sales & Customer Service, Home & Home Office Store of Hewlett Packard. 51 Thomas A. Bowers August 2020-present, Executive Vice President, Corporate Strategy of the Company. September 2019-August 2020, Vice President, Business Consulting of the…
• FY2025 10-K: ShareBasedCompensationAwardTrancheOneMember 2024-10-01 2025-09-30 0000814547 fico:MarketStockUnitsMSUsMember us-gaap:ShareBasedCompensationAwardTrancheTwoMember 2024-10-01 2025-09-30 0000814547 fico:MarketStockUnitsMSUsMember us-gaap:ShareBasedCompensationAwardTrancheThreeMember 2024-10-01 2025-09-30 0000814547…
• VRSK (Verisk Analytics, Inc.)
• FY2025 10-K: …us-gaap:SubsequentEventMember vrsk:KeyEmployeesMember 2026-01-01 2026-01-31 0001442145 us-gaap:PerformanceSharesMember us-gaap:SubsequentEventMember vrsk:KeyEmployeesMember 2026-01-01 2026-01-31 0001442145 vrsk:NonqualifiedStockOptionMember us-gaap:SubsequentEventMember 2026-01-01 2026-01-31 0001442145…
• FY2025 10-K: ., Equifax Inc., Fair Isaac Corp., Gartner, Inc., Global Payments, Inc., Clarivate PLC, Intercontinental Exchange, Inc., Jack Henry & Associates Inc., Moody's Corporation, MSCI Inc., S&P Global, and TransUnion. COMPARISON OF CUMULATIVE TOTAL RETURN Assumes $100 Invested on December 31, 2020 Assumes Dividend Reinvested…
• SPGI (S&P Global Inc.)
• FY2025 10-K: …2025-01-01 2025-12-31 0000064040 us-gaap:AccumulatedGainLossNetCashFlowHedgeParentMember 2025-01-01 2025-12-31 0000064040 us-gaap:AccumulatedTranslationAdjustmentMember 2025-12-31 0000064040 us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember 2025-12-31 0000064040…
• FY2025 10-K: …2025-01-01 2025-12-31 0000064040 spgi:TotalGeographicalAreaMember us-gaap:GeographicConcentrationRiskMember us-gaap:PropertyPlantAndEquipmentMember 2024-01-01 2024-12-31 0000064040 spgi:SpdjIndicesMember us-gaap:RelatedPartyMember 2025-01-01 2025-12-31 0000064040 spgi:SpdjIndicesMember us-gaap:RelatedPartyMember…
• MCO (Moody’s Corporation)
• FY2025 10-K: TransactionRevenueMember mco:KYCMember mco:MoodysAnalyticsMember 2024-01-01 2024-12-31 0001059556 us-gaap:OperatingSegmentsMember mco:RecurringRevenueMember mco:KYCMember mco:MoodysAnalyticsMember 2024-01-01 2024-12-31 0001059556 us-gaap:OperatingSegmentsMember mco:KYCMember mco:MoodysAnalyticsMember 2024-01-01…
• FY2025 10-K: …mco:CorporateFinanceMember mco:MoodysInvestorsServiceMember 2024-01-01 2024-12-31 0001059556 us-gaap:OperatingSegmentsMember mco:TransactionRevenueMember mco:CorporateFinanceMember mco:MoodysInvestorsServiceMember 2023-01-01 2023-12-31 0001059556 us-gaap:OperatingSegmentsMember mco:RecurringRevenueMember…

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.
• 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.