Source: Lynxbroker.com
TransUnion
is a long-term outperformer, one of the three major US credit bureaus and valued significantly lower than its direct competitors.
Opportunities and risks
However, the company has not always been lucky with its takeovers.
Neustar is a great company with great potential, and its solutions for identity verification, fraud prevention and digital marketing fit well into TransUnion's portfolio, but the price was clearly too high in my view. TransUnion had put an EV/EBITDA of 27 on the table at the time.
This decision may also have contributed to a decline in investor confidence and a rather mediocre share price performance.
However, the management has recognized this and made a U-turn. In future, the company intends to focus on smaller, strategic acquisitions, debt reduction and share buybacks.
In my view, this is the right decision and should help to regain investor confidence.
If the consensus estimates are correct, the business figures will do the rest. After all, profits are expected to rise by 17-20% in each of the next two financial years.
As TransUnion has consistently exceeded expectations in the last six quarters, it can be assumed that the forecasters are not being unnecessarily optimistic in this case.
If profits increase to the expected extent, the share should have a similarly high potential.
There is also the chance of a revaluation, as TransUnion currently has a blended P/E of 22.0 - far lower than its direct competitors Experian and Equifax at 30.7 and 34.9 respectively.
TransUnion share: Chart from 01.07.2025, price: USD 88 - symbol: TRU | Source: TWS
If the share now manages to rise above USD 90, or even better USD 93, a procyclical upward trend Kaufsignal with possible price targets at USD 100 and USD 109.
If, on the other hand, the share price falls below USD 82, a setback towards USD 71 or USD 68 must be expected
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