Here's Why You Should Retain TRU Stock in Your Portfolio Now

TransUnion TRU has had an impressive run over the past year. The company’s shares have gained 17.6% in that period, outperforming the industry’s 14.8% growth and the Zacks S&P 500 composite’s 13.6% rise.

TRU’s revenues are anticipated to increase 5.2% and 8.7% year over year in 2025 and 2026, respectively. Earnings are estimated to rise 4.7% in 2025 and 19.5% in 2026.

Factors That Augur Well for TRU’s Success

TransUnion is a key player in the rapidly growing big data and analytics market. Per The Insight Partners, in 2024, the U.S. market was valued at $293.1 billion and is projected to rise, seeing a CAGR of 13.5% from 2024 to 2031. This market is expanding at an exponential rate, driven by a vast amount of data generation and new technological advancements that facilitate swift and efficient data processing. TRU has utilized technology to enhance its analytical capabilities and broaden its database. Such strategies in a growing market attract more customers, fueling TRU’s top line.

TRU’s buyout strategy has played a vital role in its growth. The company has already secured two acquisitions within the first few months of 2025. In January, TransUnion agreed to acquire the majority ownership of Trans Union de Mexico, the consumer credit business of Buró de Crédito. This deal facilitates further expansion in Latin America, strengthens its leadership position and makes the company the largest credit bureau in Spanish-speaking Latin America.

In April, TRU acquired Monevo, a credit prequalification and distribution platform. TransUnion aims to strengthen its position in the consumer lending marketplace and improve its prequalification capabilities by leveraging Monevo.

TransUnion’s current ratio at the end of the first quarter of 2025 was 2.05, which is impressive, given that the industry average is 0.88. Additionally, improving from the previous quarter’s 1.7 and the year-ago quarter’s 1.65 reassures investors about the company’s favorable liquidity position in the long run. It is important to remember that a current ratio exceeding 1 indicates that the company can effectively pay off short-term obligations.

Risks Faced by TransUnion

TRU operates in a highly competitive market, locking horns with the likes of Equifax and LexisNexis in the U.S. market segment. In the consumer interactive segment, the company must deal with companies like FICO and LifeLock. LiveRamp and Experian are major competitors within the marketing solutions space. Competitive pressure as such, piling onto the company’s shoulders from every corner, necessitates investment in technology and talent, increasing difficulty in growing while remaining profitable.

Seasonality is an issue that the company must tackle as well. While the U.S. market segment registers soft sales in the first and fourth quarters compared with the remaining ones, the consumer interactive segment experiences weaker demand in the second half of the year.

The international segment of the company faces turbulence due to local economic conditions and the macroeconomic environment of the market. This results in fluctuations in revenues and profits, making the long-term picture blurry and discouraging investors. 

TRU’s Zacks Rank & Stocks to Consider

The company has a Zacks Rank #3 (Hold) at present.

Some better-ranked stocks from the broader Zacks Business Services sector are Limbach LMB and Qifu Technology QFIN, each currently flaunting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Limbach has a long-term earnings growth expectation of 12%. LMB delivered a trailing four-quarter earnings surprise of 91.2%, on average.

Qifu Technology has a long-term earnings growth expectation of 11.3%. QFIN delivered a trailing four-quarter earnings surprise of 14.3%, on average.

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This article originally published on Zacks Investment Research (zacks.com).

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