Even if a company is profitable, it doesn’t always mean it’s a great investment.
Some struggle to maintain growth, face looming threats, or fail to reinvest wisely, limiting their future potential.
Mid-cap stocks have the best odds of scaling into $100 billion corporations thanks to their tested business models and large addressable markets.
But the many opportunities in front of them attract significant competition, spanning from industry behemoths with seemingly infinite resources to small, nimble players with chips on their shoulders.
While strong cash flow is a key indicator of stability, it doesn’t always translate to superior returns.
Some cash-heavy businesses struggle with inefficient spending, slowing demand, or weak competitive positioning.
While the S&P 500 (^GSPC) includes industry leaders, not every stock in the index is a winner.
Some companies are past their prime, weighed down by poor execution, weak financials, or structural headwinds.
The end of the earnings season is always a good time to take a step back and see who shined (and who not so much). Let’s take a look at how data & business process services stocks fared in Q1, starting with TransUnion (NYSE:TRU).
Equifax’s first quarter results were shaped by broad-based growth across non-mortgage segments and positive momentum in new product rollouts, leading to a market reaction that reflected investor approval. Management credited the strong performance to the accelerated adoption of its cloud-native platform and the introduction of proprietary solutions, such as the “TWIN-powered” mortgage tool that combines employment, income, and credit data. CEO Mark Begor stated, “Our strong first quarter is a proof point to the power of the Equifax cloud as our team can now fully focus on growth, innovation and customers.”
The stocks in this article have caught Wall Street’s attention in a big way, with price targets implying returns above 20%.
But investors should take these forecasts with a grain of salt because analysts typically say nice things about companies so their firms can win business in other product lines like M&A advisory.
When Wall Street turns bearish on a stock, it’s worth paying attention.
These calls stand out because analysts rarely issue grim ratings on companies for fear their firms will lose out in other business lines such as M&A advisory.
