S&P 500 (NYSE:SPY) component Equifax Inc. (NYSE:EFX) will unveil its latest earnings on Wednesday, October 24, 2012. Equifax provides information solutions, employment and income verification, and human resources business process outsourcing services.
Equifax Inc. Earnings Preview Cheat Sheet
Wall St. Earnings Expectations: The average analyst estimate is for profit of 72 cents per share, a rise of 10.8% from the company’s actual earnings for the year-ago quarter. During the past three months, the average estimate has moved down from 74 cents. Between one and three months ago, the average estimate moved down. It also has dropped from 73 cents during the last month. Analysts are projecting profit to rise by 12.7% versus last year to $2.84.
Past Earnings Performance: Last quarter, the company beat estimates by 2 cents, coming in at net income of 74 cents a share versus the estimate of profit of 72 cents a share. It marked the fourth straight quarter of beating estimates.
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A Look Back: In the second quarter, profit rose more than twofold to $76.4 million (62 cents a share) from $34.5 million (28 cents a share) the year earlier, exceeding analyst expectations. Revenue rose 10% to $535.8 million from $487.1 million.
Wall St. Revenue Expectations: On average, analysts predict $540.4 million in revenue this quarter, a rise of 10.2% from the year-ago quarter. Analysts are forecasting total revenue of $2.14 billion for the year, a rise of 9.2% from last year’s revenue of $1.96 billion.
Stock Price Performance: Between August 22, 2012 and October 18, 2012, the stock price had risen $4.54 (9.8%), from $46.52 to $51.06. The stock price saw one of its best stretches over the last year between October 9, 2012 and October 18, 2012, when shares rose for eight straight days, increasing 4.7% (+$2.29) over that span. It saw one of its worst periods between September 18, 2012 and September 26, 2012 when shares fell for seven straight days, dropping 4.9% (-$2.37) over that span.
This upcoming earnings announcement will be a chance to build on positive earnings momentum over the last three quarters. Net income rose 19.6% in the fourth quarter of the last fiscal year and 24.8% in the first quarter before increasing again in the second quarter.
On the top line, the company is looking to build on four-straight revenue increases heading into this earnings announcement. Revenue rose 3.5% in the third quarter of the last fiscal year, 5.7% in the fourth quarter of the last fiscal year and 10.6% in the first quarter before increasing again in the second quarter.
Analyst Ratings: There are mostly holds on the stock with six of 11 analysts surveyed giving that rating.
Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 1.76 last quarter. The current ratio is an indication of a firm’s liquidity and ability to meet creditor demands and generally, for every dollar the company owes in the short term, it has that figure available in assets that can be converted to cash in the short term. The company improved this liquidity measure from 1.74 in the first quarter to the last quarter driven in part by an increase in current assets. Current assets increased 8.8% to $517 million while liabilities rose by 7.7% to $293.8 million.
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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)
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