Equifax's Return on Capital Employed: A Multi-Bagger in the Making?

Equifax's return on capital employed (ROCE) has increased to 11% in the last five years, with a 39% growth in capital. This indicates opportunities for reinvestment and higher returns, making the company a potential multi-bagger. The stock has returned 49% to shareholders over the last five years.

Equifax Inc. (EFX) has demonstrated a commendable track record of financial performance and strategic reinvention over the past five years. The company's return on capital employed (ROCE) has increased to 11%, while capital employed has grown by 39%. This robust performance has opened up opportunities for reinvestment and higher returns, making Equifax a potential multi-bagger for investors.

The stock has returned 49% to shareholders over the last five years, underscoring the company's ability to generate value for its investors. This impressive performance can be attributed to Equifax's disciplined execution and strategic pivot towards the cloud, as highlighted in its Q3 2025 investor engagement strategy [1].

Equifax's Q3 2025 investor engagement strategy was marked by high-profile speaking slots at the Barclays Virtual Credit Bureau Day and J.P. Morgan U.S. All Stars Conference, coupled with live webcasts and 24-hour replays. This approach ensured that even passive investors could stay informed, reinforcing the company's commitment to transparency and accessibility [1].

The $3 billion New Equifax Cloud™ initiative is a cornerstone of this strategy. By unifying data from over 100 sources into a custom data fabric, Equifax is accelerating AI-driven decision-making and customer solutions. This transformation is not just about technology; it's a structural shift that positions the company to dominate in data analytics and personalized services [2].

Financially, Equifax has shown resilience, with Q2 2025 results exceeding guidance by $27 million in revenue. This performance underscores the company's operational discipline, even amid market challenges. Analysts have responded positively, with a "Outperform" consensus rating and an average one-year price target of $294.77, reflecting confidence in Equifax's ability to sustain growth [1].

Equifax's full-year 2025 guidance of 5.1% to 6.3% revenue growth and $7.33 to $7.63 adjusted EPS aligns with its Q3 projections, signaling a stable trajectory. While the company lags peers in revenue growth, its 9.23% net margin and strong performance in the Workforce Solutions and USIS segments demonstrate operational discipline [1].

In conclusion, Equifax's strategic reinvention, driven by a focus on investor trust and technological leadership, presents a compelling case for long-term investment. The company's ability to generate consistent returns and reinvest in growth opportunities makes it a potential multi-bagger for investors willing to look beyond short-term volatility.

References:
[1] https://www.ainvest.com/news/equifax-q3-2025-investor-engagement-blueprint-credibility-growth-2508/
[2] https://www.nasdaq.com/articles/glimpse-equifaxs-earnings-potential
[3] https://www.equifax.com/newsroom/all-news/-/story/equifax-2025-investor-day-the-new-efx-and-post-cloud-growth/