Sharecast - "One reason we believe Experian trades a higher multiple (circa 28x P/E) relative to our European payments and business services coverage is the perceived moat around the vast pools of data it collects from businesses and users to then monetise several times over," CS said.
"This moat is expected to last long into the future because of how scarce data is, or appears to be, hence extending the period before Experian fades to its terminal growth rate."
Credit Suisse (SIX:CSGN) said the company’s long-term stated targets imply earnings per share growth in the mid-to-high single-digit range, and PEG (price/earnings-to-growth) of around 2.8x, versus around 1.8x and 1.7x, respectively, for Visa (NYSE:V) and Mastercard (NYSE:MA), which have a similar moat with $15tr+ in global transactions, and around 1.5x for Adyen, which is the bank’s top pick.
"We believe that this moat will withstand competition in the coming years as data ownership returns to individuals (via Open Banking/Data), democratising the key asset Experian sells: data (circa 50% of revenues).
"In our view, Experian is a high-quality company with preferred positioning within its core markets, expanding to additional verticals, and executed a 2015-16 turnaround; however, we see it as fairly valued at current levels."
At 1050 GMT, the shares were down 2.7% at 2,882p.
