Analyzing Equifax (EFX) & S&P Global (SPGI)
Equifax (NYSE: EFX) and S&P Global (NYSE:SPGI) are both large-cap business services companies, but which is the better business? We will compare the two businesses based on the strength of their analyst recommendations, profitability, valuation, institutional ownership, earnings, risk and dividends.
Insider and Institutional Ownership
89.6% of Equifax shares are held by institutional investors. Comparatively, 84.4% of S&P Global shares are held by institutional investors. 1.3% of Equifax shares are held by insiders. Comparatively, 0.2% of S&P Global shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.
Risk and Volatility
Equifax has a beta of 0.91, indicating that its stock price is 9% less volatile than the S&P 500. Comparatively, S&P Global has a beta of 1.52, indicating that its stock price is 52% more volatile than the S&P 500.
Valuation & Earnings
This table compares Equifax and S&P Global’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Equifax||$3.29 billion||5.23||$1.22 billion||$4.72||30.27|
|S&P Global||$5.80 billion||6.71||$2.66 billion||$8.56||17.70|
S&P Global has higher revenue and earnings than Equifax. S&P Global is trading at a lower price-to-earnings ratio than Equifax, indicating that it is currently the more affordable of the two stocks.
Equifax pays an annual dividend of $1.56 per share and has a dividend yield of 1.1%. S&P Global pays an annual dividend of $1.64 per share and has a dividend yield of 1.1%. Equifax pays out 33.1% of its earnings in the form of a dividend. S&P Global pays out 19.2% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Equifax has raised its dividend for 5 consecutive years. Equifax is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This is a breakdown of recent ratings and recommmendations for Equifax and S&P Global, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Equifax presently has a consensus price target of $146.60, indicating a potential upside of 2.60%. S&P Global has a consensus price target of $150.00, indicating a potential downside of 0.99%. Given Equifax’s higher probable upside, equities analysts clearly believe Equifax is more favorable than S&P Global.
This table compares Equifax and S&P Global’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
S&P Global beats Equifax on 11 of the 16 factors compared between the two stocks.
Equifax Company Profile
Equifax Inc. is a global provider of information solutions and human resources business process outsourcing services for businesses, governments and consumers. The Company operates in four segments: U.S. Information Solutions (USIS), International, Workforce Solutions and Global Consumer Solutions. Its products and services are based on databases of consumer and business information derived from various sources, including credit, financial assets, telecommunications and utility payments, employment, income, demographic and marketing data. It uses statistical techniques and software tools to analyze all available data, creating customized insights, decision-making solutions and processing services for its clients. It helps consumers understand, manage and protect their personal information and make more informed financial decisions. The Company also provides information, technology and services to support debt collections and recovery management.
S&P Global Company Profile
S&P Global Inc., formerly McGraw Hill Financial Inc., is a provider of ratings, benchmarks, analytics and data to the capital and commodity markets around the world. The Company operates through three segments: Ratings, which provides credit ratings, research and analytics to investors, issuers and other market participants; Market and Commodities Intelligence, which offers multi-asset-class data, research and analytical capabilities that integrate cross-asset analytics and desktop services, and deliver their customers in the commodity and energy markets access to information, data, analytic services and pricing and benchmarks, and S&P Dow Jones Indices (Indices), which is an index provider that maintains a range of valuation and index benchmarks for investment advisors, wealth managers and institutional investors. The Company’s subsidiary, CRISIL Limited (CRISIL), is a global analytical company and a provider of ratings, data and research, analytics and solutions.
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