Increasing Our Equifax Uncertainty Rating to High

Ahead of the firm’s first-quarter earnings release, we are maintaining our fair value estimate of $315 per share on wide-moat-rated Equifax as a slightly lower 2023 revenue estimate is offset by time value of money. We are lowering our revenue estimate for nonmortgage verification services revenue as we trim our expectations for talent solutions. Equifax’s talent solutions business provides businesses with preemployment background screening, particularly for professional workers. We expect volumes to be negatively impacted by companies being cautious about hiring. We are also raising our Morningstar Uncertainty Rating on Equifax to High from Medium in order to account for a wider range of outcomes for its fast growing workforce solutions segment. We continue to view the stock as attractive from a risk/reward perspective as we view Equifax workforce solutions, its largest segment, as differentiated with strong revenue growth drivers including payroll record growth, pricing, and higher penetration.