Critical Analysis: FactSet Research Systems (FDS) & TransUnion (TRU)
FactSet Research Systems (NYSE: FDS) and TransUnion (NYSE:TRU) are both mid-cap business services companies, but which is the superior business? We will contrast the two businesses based on the strength of their risk, earnings, analyst recommendations, valuation, profitability, dividends and institutional ownership.
Insider and Institutional Ownership
94.6% of FactSet Research Systems shares are owned by institutional investors. 2.7% of FactSet Research Systems shares are owned by insiders. Comparatively, 2.1% of TransUnion shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.
This is a summary of current ratings for FactSet Research Systems and TransUnion, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|FactSet Research Systems||3||7||1||0||1.82|
FactSet Research Systems currently has a consensus price target of $165.00, suggesting a potential upside of 3.92%. TransUnion has a consensus price target of $46.14, suggesting a potential upside of 0.88%. Given FactSet Research Systems’ higher possible upside, equities research analysts clearly believe FactSet Research Systems is more favorable than TransUnion.
FactSet Research Systems pays an annual dividend of $2.24 per share and has a dividend yield of 1.4%. TransUnion does not pay a dividend. FactSet Research Systems pays out 26.2% of its earnings in the form of a dividend. FactSet Research Systems has increased its dividend for 11 consecutive years.
Risk & Volatility
FactSet Research Systems has a beta of 0.95, indicating that its stock price is 5% less volatile than the S&P 500. Comparatively, TransUnion has a beta of 0.61, indicating that its stock price is 39% less volatile than the S&P 500.
Valuation & Earnings
This table compares FactSet Research Systems and TransUnion’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|FactSet Research Systems||$1.18 billion||5.28||$414.14 million||$8.55||18.57|
|TransUnion||$1.80 billion||4.62||$636.70 million||$1.16||39.43|
TransUnion has higher revenue and earnings than FactSet Research Systems. FactSet Research Systems is trading at a lower price-to-earnings ratio than TransUnion, indicating that it is currently the more affordable of the two stocks.
This table compares FactSet Research Systems and TransUnion’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|FactSet Research Systems||29.02%||55.72%||25.28%|
FactSet Research Systems beats TransUnion on 11 of the 17 factors compared between the two stocks.
FactSet Research Systems Company Profile
Factset Research Systems Inc. is engaged in providing integrated financial information and big data analytical applications for the global investment community. The Company’s segments include the U.S., Europe and Asia Pacific. The U.S. segment services finance professionals, including financial institutions throughout the Americas. The European segment maintains offices in France, Germany, Italy, Ireland, Latvia, Luxembourg, the Netherlands, Spain, South Africa, Sweden and Dubai. The Asia Pacific segment maintains office locations in Australia, Hong Kong, Singapore and Mumbai, India. The Company delivers insight and information to investment professionals through its analytics, service, content, and technology. Its offerings include a complete services solution focused on verifying, cleaning and loading portfolio data across asset classes, and an execution management system. The Company offers third-party content through desktop, wireless and off-platform solutions.
TransUnion Company Profile
TransUnion is a risk and information solutions provider to businesses and consumers. The Company provides consumer reports, risk scores, analytical services and decision capabilities to businesses. The Company operates through three segments: U.S. Information Services (USIS), International and Consumer Interactive. The USIS segment provides consumer reports, risk scores, analytical services and decisioning capabilities to businesses. The International segment provides services similar to its USIS segment to businesses in select regions outside the United States. The Consumer Interactive segment offers solutions that help consumers manage their personal finances and take precautions against identity theft. Businesses uses its solutions for their process workflows to assess consumer ability to pay for services, measure and manage debt portfolio risk, collect debt, verify consumer identities and investigate potential fraud.
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