EFX — Equifax Inc.

The tape is conflicted: Q3 revenue rose 10% to $1.693B and adjusted EPS of $2.26 beat by about $0.06, but Q4 revenue guidance of ~$1.62B missed the ~$1.68B consensus and triggered target cuts from Morgan Stanley, Needham, Barclays, BMO, and Mizuho. The 11.8% one-week rally as of 2026-10-20 suggests some investors are looking past the guide to cost controls and rate-cut optionality, while the 13.4% six-month decline shows the market has already de-rated the mortgage exposure.

Revenue grew from $1.327B in Q4 2023 to $1.693B in Q3 2026, with YoY growth accelerating to +14.4% in Q1 2026 and +10.6% in Q2 before +9.5% in Q3. The implied Q4 2026 revenue of ~$1.620B is only +4.4% YoY, a clear deceleration tied to mortgage. Margins are improving YoY in Q3—operating 21.0% vs 17.1%, net 12.5% vs 10.4%—but Q2 2026 operating margin slipped to 18.5% from 20.2%. EPS is lumpy (Q3 $1.79 vs $1.29; Q2 $1.54 vs $1.53; Q1 $1.42 vs $1.06), and next-FY consensus EPS of $8.501 is flat with 2026's ~$8.50, so this is a cyclical pause, not yet a structural decline.

As of 2026-10-20, EFX is cheap versus its own history but not absolutely cheap: trailing P/E 26.8x, forward P/E 19.6x on $8.501 next-FY EPS, P/S 2.97x versus a 5.52x five-year average, and PEG 1.54. The 46.1x five-year average P/E is distorted by earlier high-growth/low-rate periods, so the current discount mostly reflects flat 2026-27 EPS growth and mortgage cyclicality; fair value is closer to 20x forward EPS than to the historical average.

As of 2026-10-20, the $166.71 price is 19.6x next-FY EPS of $8.501; consensus target $202.31 implies 23.8x. The market is pricing a flat-to-modestly-recovering 2027, not a housing boom. If Q4 revenue holds near $1.62B and cost cuts keep EPS near $8.50, downside is limited, but upside needs either multiple expansion or a faster rate-cut-driven mortgage recovery; paying up before evidence of that is risky.

As of 2026-10-20, RSI was 63.58, price was 12.29% above its 20-day SMA, -0.07% versus its 50-day SMA, and -6.58% versus its 200-day SMA. One-week return was +11.83%, one-month +4.93%, three-month -3.64%, and six-month -13.36%. The sharp rebound has run into resistance near the 50-day and remains below the 200-day; entry timing is poor after an 11.8% week, better to wait for a pullback or confirmation above the 200-day.

• Mortgage rates near ~7% have pushed U.S. origination volumes roughly 50% below peak, directly hitting Equifax's high-margin mortgage verification and inquiry revenue.
• A Fed pivot toward rate cuts could thaw housing in 2027, but timing is uncertain and Q4 2026 guidance already assumes a weaker mortgage market.
• Regulatory scrutiny of credit-reporting accuracy, data privacy, and algorithmic fairness keeps compliance costs high, though it reinforces barriers to entry.
• Non-mortgage verticals—identity verification, commercial analytics, international, and consumer-permissioned open-banking/cash-flow data—are growing and cushioning the mortgage drag.
• Leverage is manageable but not light: $5.05B long-term debt against $4.47B equity and a 1.09 current ratio limit flexibility if the cycle stays weak.

• Q4 2026 earnings on 2027-02-04 (estimated): evidence that revenue lands near the $1.62B midpoint and cost controls hold adjusted EPS near $8.50.
• Fed rate cuts and a pickup in U.S. mortgage originations, which would revive high-margin verification and inquiry volumes.
• Scaling of the Mastercard Open Finance integration and consumer-permissioned cash-flow underwriting, which could broaden non-mortgage growth.
• Further analyst target revisions and 2027 guidance; current consensus target is $202.31 versus a recent average of $198.47.

• Mortgage rates stay near 7% and housing volumes remain depressed, delaying the expected cyclical recovery.
• Q4 2026 revenue guidance of ~$1.62B is already below consensus; further cuts would pressure the multiple.
• Regulatory or legal action, or a data breach/accuracy issue, could raise compliance costs and damage trust.
• Leverage and tight liquidity: $5.05B long-term debt, $192.9M cash, and a 1.087 current ratio.
• Competition from alternative data and open-banking models could erode pricing over time.

Equifax is a high-barrier data franchise sitting in a mortgage-driven cyclical trough, but the near-term setup is not compelling: Q4 guidance implies revenue growth slowing to ~4.4%, next-FY EPS is flat, and the balance sheet carries $5.05B long-term debt against $4.47B equity. The stock is cheap versus its own inflated history, not versus a modest-growth, mortgage-exposed business; evidence of housing stabilization or a lower entry would be needed before getting constructive.

Applied a 20x forward P/E to next-FY consensus EPS of $8.501—below the distorted 46.1x five-year average and roughly in line with the current 19.6x forward multiple—to reflect flat near-term EPS growth, 1.16x debt-to-equity, and mortgage cyclicality; 20 × $8.501 = $170.02.