Credit Where It's Due: TransUnion Gets A 'Buy' Upgrade As Q1 Results Crush Expectations

Needham analyst Kyle Peterson upgraded the rating on TransUnion TRU to Buy from Hold at a price target of $84.
The analyst is bullish on TRU's Q1 2023 results exceeding their expectations.
TRU reported Q1 revenues of $940.3 million, above the consensus of $913.7 million and Needham's estimate of $911.2 million. EPS of $0.80 exceeded the consensus and Needham's estimate of $0.74.
The analyst believes the company's solid core performance and additional debt prepayment helped negate the impact of weakness in the unsecured consumer lending business in the quarter.
TRU maintained 2023 guidance for revenues at $3.825-$3.885 billion (vs Needham's estimate $3.86 billion)
The company slightly raised 2023 adjusted EPS to $3.49-$3.62 (vs Needham's estimate $3.54) from the prior range of $3.46-$3.59.
TRU stated that it is prioritizing the use of excess cash to reduce debt, with every $100 million in debt prepayment enhancing annualized EPS by $0.03.
Given the uncertain economic environment, the analyst sees the company's FY23 guidance reiteration and further debt prepayments as positive.
Price Action: TRU shares are trading higher by 2.81% at $64.84 on the last check Wednesday.

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