This is a step-by-step stock review to answer the question, is TransUnion (TRU) stock a good buy?
This article will teach you how to use the 4Ms of investing. This will be a detailed walkthrough to show you how the 4Ms work and why they are important. If you are interested, you can log into Tykr to use the 4M Confidence Booster (Powered by OpenAI) which will allow you to complete a 4M Analysis in less than 60 seconds.
What are the 4Ms?
- MOS (Margin of Safety) – The MOS is the math part of investing which includes the Summary, Score, and MOS (Margin of Safety).
- Meaning – The meaning is the business model and how scalable the revenue streams are.
- Moat – The moat is how the business compares to other companies in the same Sector and Industry.
- Management – The management is the track record of the CEO.
What 4M score are we going for?
- 80-100 = High confidence – Yay! You should have high confidence buying this stock. It passes all 4M!
- 60-79 = Moderate confidence – Alert! There may be better stocks in the market. Only buy this stock if you truly believe the company will improve!
- 0-59 = Low confidence – Warning! There are better stocks in the market. Due to the low score, you should consider looking at other stocks.
Table of Contents
The following links will direct you to key topics to help answer the question, is TransUnion (TRU) stock a good buy?
- TransUnion Company History
- MOS
- Meaning
- Moat
- Management
- 4M Score
- Is TransUnion (TRU) stock a good buy?
1. TransUnion Company History
When investing in stocks, it’s important to know the company’s history. This helps us understand the various revenue streams, if they acquired other companies, how they grew through difficult times, and how they separated themselves from the competition.
- Founded in 1968: Established in Chicago, Illinois, initially as a railcar leasing company before transitioning to credit reporting.
- Early Acquisition: Acquired the Credit Bureau of Cook County in 1969, marking its entry into the consumer credit information market.
- Innovative Growth: Pioneered the use of advanced technology to provide faster and more accurate credit reporting services.
- Global Expansion: Expanded internationally, now operating in over 30 countries and providing credit information and risk management solutions worldwide.
- Public Offering in 2015: Went public, listing on the New York Stock Exchange under the ticker symbol TRU.
- Comprehensive Services: Offers a wide range of services including credit reports, fraud protection, and credit monitoring for consumers and businesses.
- Commitment to Data Security: Implements robust data protection measures to safeguard sensitive consumer information.
- Technological Advancements: Invests in big data, machine learning, and analytics to enhance the accuracy and efficiency of credit reporting.
- Acquisitions and Partnerships: Acquired companies like Neustar and partnered with various firms to broaden its service offerings and capabilities.
- Corporate Responsibility: Focuses on financial inclusion and literacy, helping consumers understand and manage their credit health.
- Innovation Leadership: Continues to lead in the development of new solutions for identity verification, fraud prevention, and financial decision-making.
- Mission Statement: Committed to providing the insights and information needed to help individuals and businesses make informed decisions and achieve great things.
TransUnion remains a key player in the global credit reporting industry, dedicated to innovation, security, and empowering consumers and businesses with reliable information.
2. MOS (Margin of Safety)
When investing in a company, the first step is to look at the financials. Fortunately, Tykr does this for us automatically. The higher the score, the stronger the financials and the safer the investment. The higher the MOS, the higher the potential returns you can make.
- Summary: overpriced
- Score: 39/100
- MOS: 1%
To see the most up-to-date Summary, Score, and MOS, please log into Tykr.
3. Meaning
When investing in a company, it’s important to know how a company makes money. A mature business model has multiple streams of revenue which allow the company to weather downturns in the economy.
Here is how TransUnion (TRU) makes money:
- Credit Reporting Services: Provides credit reports and scores to businesses and consumers.
- Credit Monitoring: Alerts consumers to changes in their credit reports, aiding in identity theft prevention.
- Identity Verification: Authenticates customers for businesses, preventing online fraud.
- Fraud Prevention: Detects and protects against identity theft and fraudulent activities.
- Decisioning Services: Helps businesses manage credit and risk with informed decisions.
- Marketing Services: Uses credit and demographic data to target new customers for businesses.
- Analytics and Insights: Provides actionable intelligence to improve customer acquisition and retention.
- Compliance Services: Ensures businesses meet regulatory requirements in credit reporting and data privacy.
- Rental Screening Services: Conducts credit and background checks for rental applicants.
- Healthcare Solutions: Verifies patient identities and prevents medical identity theft for healthcare providers.
- Automotive Solutions: Streamlines car-buying processes, verifies customer identities, and mitigates fraud for dealerships and lenders.
TransUnion’s services aid businesses in decision-making and empower consumers to manage their credit effectively.
Here are a few of the other companies that TransUnion (TRU) has acquired over the years. This is important because a company will use a “Buy before build” philosophy to go to market faster and add additional streams of revenue. A company with more revenue streams has a more stable business model. Keep in mind, that most companies don’t build new software because it takes too long to go to market and generate revenue.
- Callcredit Information Group
- Trustev
- eBureau
- iovation
4. Moat
When investing in a company, it’s important to understand how a company ranks against other companies in the same sector and industry. Based on the Score, here is how TransUnion (TRU) stacks up against other companies.
- FTI Consulting, Inc.(FCN) – 84
- Booz Allen Hamilton Holding Corporation(BAH) – 61
- Equifax Inc.(EFX) – 61
- Franklin Covey Co. (FC) – 39
- TransUnion. (TRU) – 39
To see the most up-to-date Summary, Score, and MOS and each stock, please log into Tykr.
5. Management
When investing in a company, it’s important to understand who the CEO is, what they have accomplished in the past, and how they have helped this company grow. Good leaders typically have stronger cultures, less turnover, and better returns in the stock market.
- CEO Leadership: Chris Cartwright Became CEO of TransUnion in May 2019, steering the company with effective leadership.
- Revenue Growth: Achieved significant revenue growth, increasing TransUnion’s market value.
- Global Expansion: Expanded TransUnion’s global footprint, entering new markets and acquiring international businesses.
- Digital Transformation: Led a major digital transformation, integrating advanced technology to improve data solutions and customer experiences.
- Data Security: Strengthened data security measures, ensuring the protection of consumer information.
- Innovative Products: Launched new and innovative products, keeping TransUnion competitive in the market.
- Customer Focus: Enhanced customer satisfaction through improved services and tailored solutions.
- Sustainability Initiatives: Promoted sustainability initiatives, aligning TransUnion with environmental and social governance (ESG) standards.
- Operational Efficiency: Improved operational efficiency, reducing costs and increasing profitability.
- Employee Engagement: Fostered a positive work culture, enhancing employee engagement and retention.
6. 4M Score
All of our homework on this company leads up to the 4M Score. A lot of investors only look at the numbers. Yes, it’s important to look at the first M (MOS) which is the math part of investing but it’s also important to look past the numbers and also look at the Meaning, Moat, and Management. If all 4Ms pass, we should have high confidence in buying this stock.
What 4M score are we going for?
- 80-100 = High confidence – Yay! You should have high confidence buying this stock. It passes all 4M!
- 60-79 = Moderate confidence – Alert! There may be better stocks in the market. Only buy this stock if you truly believe the company will improve!
- 0-59 = Low confidence – Warning! There are better stocks in the market. Due to the low score, you should consider looking at other stocks.
👉 The 4M Score of TransUnion (TRU) is 50/100.
To see the most up-to-date 4M Score, please log into Tykr.
7. Is TransUnion (TRU) stock a good buy?
Some of the top questions investors can have is TransUnion (TRU) stock a good buy or should I buy TransUnion (TRU) stock?
Investing in TransUnion can be advantageous due to its strong position in the credit reporting and information services industry. The company benefits from increasing demand for credit data and analytics, supporting its consistent revenue growth. TransUnion’s global expansion, innovative product offerings, and focus on digital transformation enhance its market competitiveness. Additionally, the company’s commitment to data security and customer-centric solutions strengthens its reputation and client base. However, potential investors should consider risks such as regulatory changes, economic fluctuations, and competition. Evaluating TransUnion’s financial stability, market strategy, and alignment with your investment objectives will help determine if it’s a suitable addition to your portfolio.
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To truly know if TransUnion is a good stock to buy or sell, we recommend you log into Tykr. Within seconds you can see the Summary, Score, MOS, and 4M Score.
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