Key Stats for Equifax Stock
- Past-Week Performance: -6%
- 52-Week Range: $166 to $281
- Valuation Model Target Price: $295
- Implied Upside: 54%
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What Happened?
Equifax Inc. stock fell about 6% over the past week, ending near $191 per share, as investors reassessed valuation following an earnings update and absorbed a wave of analyst price target reductions. The pullback reflected cautious positioning rather than a reaction to a single negative headline.
Shares moved lower this week as investors reset expectations after Equifax’s Q4 2025 earnings release, despite results coming in ahead of prior guidance.
The company reported revenue of $1.55 billion, up 9% year over year, and adjusted EPS of $2.09, supported by solid performance in Workforce Solutions and mortgage-related products. For the full year, free cash flow reached $1.13 billion, delivering a record 120% cash flow conversion rate.
CEO Mark Begor said the strong close to the year “gives us strong momentum for a strong 2026,” but that optimism was overshadowed by valuation concerns last week.
Analyst updates reinforced the cautious tone. JPMorgan cut its price target to $230 from $260 while maintaining an Overweight rating, Royal Bank of Canada lowered its target to $222 from $250 while keeping an Outperform rating.
Wells Fargo trimmed its target to $240 from $265, reflecting multiple compression rather than weakening fundamentals.
Needham reduced its target to $265 from $295 but reiterated a Buy rating, leaving overall analyst sentiment at Moderate Buy, with revised targets spanning roughly the low-$220s to mid-$260s.
Institutional activity showed selective repositioning rather than broad exit. Allianz Asset Management increased its stake by 6.0%, while Strengthening Families & Communities LLC initiated a new position during the quarter.
Offsetting those moves, Bank of New York Mellon reduced its stake by 8.2%, pointing to portfolio rebalancing rather than a loss of long-term conviction.
Overall, last week’s decline reflected valuation pressure layered on top of otherwise resilient operating performance.
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Is Equifax Undervalued?
Under valuation assumptions, the stock is modeled using:
- Revenue Growth (CAGR): 9.5%
- Operating Margins: 22.4%
- Exit P/E Multiple: 21.9x
Revenue expectations reflect sustained demand for Equifax’s proprietary data, analytics, and decisioning tools, with growth increasingly driven by cloud-based delivery, AI-enabled products, and share gains rather than purely cyclical credit activity.
Analyst assumptions continue to point to expansion led by Workforce Solutions, identity and fraud solutions, and non-mortgage lending use cases, where employers and lenders rely on automated verification regardless of hiring or credit cycles.
This supports the view that future returns depend more on margin expansion, product mix improvement, and monetization of proprietary data than on a broad-based rebound in mortgage or hiring volumes.
Based on these inputs, the valuation model estimates a target price of $295, implying about 54% upside from current levels over roughly three years, indicating the stock appears undervalued today.
Results over the next year hinge on execution across several higher-impact areas. Continued cloud migration and AI deployment should support operating leverage, while new product rollouts tied to income, employment, and fraud analytics could deepen customer penetration and reinforce pricing power.
At current levels, Equifax appears undervalued, with future performance driven by margin recovery, AI-led product adoption, and the rising importance of proprietary data in financial decisioning rather than a rapid rebound in underlying credit or hiring markets.
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