Monday, June 6, 2011

Equifax Analysis

Let's say you owned a business where your customers store their valuables with you and every time they want to access it they pay a fee to you. Plus, they also buy insurance from you for the safety of those very valuables, just in case they were stolen. Isn't that a wonderful business ? Cherry on the cake, customers have to buy this service at birth and continue paying for it by law till death. If they don't like your price they only have two other options which are equally expensive. So, if you like this business, you'll like equifax, it's one of the 3 credit data providers. Equifax is one of the three companies that maintains your credit history and provides a credit score. It's quite cheap on a pe and cash flow basis and it falls in the category of businesses where the management can play golf the whole day and earnings won't change a tiny bit. I have posted slides on this stock in 2009, the story hasn't changed, the drivers are the same and it's still selling at fair to undervalued levels. Here's a link to my slides from 2009:

-- Ketul