Equifax Inc. (NYSE:EFX) fell 4.20% on September 24 to close at $148.80, its lowest point in a year. The shares have lost roughly 42% of their value from last year’s high.
The shares have fallen alongside a twelve-month climb in long-term borrowing costs, with the 30-year Treasury yield reaching its highest level since 2004 this week. The odd part is that the year’s biggest decision on credit scoring went in Equifax’s favor.
Equifax Gets Paid When People Borrow, and Mortgages Have Stalled:
A credit bureau does not lend money. It sells the information lenders need before they lend, and it charges per inquiry. That makes the business a direct read on borrowing activity. When a bank checks a credit file before writing a mortgage, Equifax earns a fee. When nobody applies for a mortgage, that fee does not exist.
Mortgage lending is the part most exposed to what the bond market has been doing. With long yields at levels last seen before the financial crisis, home loan volumes have little reason to recover, and the inquiries that generate Equifax revenue go with them. Revenue across the whole company is still growing at double digits, so this is not a business in decline. What the market is pricing is the mortgage cycle behind the fee line, and that cannot turn while borrowing costs stay where they are. Refinancing, which normally cushions a slow market for house purchases, is not available as a fallback when rates are rising.
The scale involved is substantial. Equifax turns over about $6.4 billion a year across three arms, covering employment and income verification, its United States credit files, and its international operations.
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The Data is Still Irreplaceable, and the Regulator Just Helped:
Start with the decision nobody priced in. When the mortgage regulator opened scoring to a rival product, the beneficiary was VantageScore, which Equifax jointly owns with the other two bureaus. That ended Fair Isaac’s monopoly and handed a share of the replacement to Equifax.
What has not changed is the asset. There are three credit bureaus in the United States, and there will not be a fourth. The barrier is not technology but decades of accumulated records that nobody can recreate.
Equifax also owns something rarer. Its Workforce Solutions arm holds payroll records used to verify income, a database employers feed directly, and competitors cannot assemble. Lenders, landlords and government agencies all pay to query it.
The valuation now reflects a lot of pessimism. The shares trade near sixteen times what analysts expect next year. Analysts put the average target above $200, well clear of where the stock sits.
Conclusion:
Equifax is down 42% from its high because the mortgage cycle has stalled, not because its data has become less valuable, and the payroll records it holds remain close to impossible to replicate. Revenue is still growing at double digits, the shares change hands near sixteen times next year’s expected earnings, and hedge fund ownership has risen. However, mortgage volumes cannot recover while long yields sit at 2004 levels, and the market will keep discounting the fee line until they do. The number to watch is Workforce Solutions revenue at the next quarterly report. That division is the moat, and it is the one that has to hold.
Market Sentiment:
Equifax Inc. was held by 57 hedge funds with a combined stake value of about $2.7 billion at the end of Q2 2026 in the Insider Monkey database. This is up from 45 hedge fund holders with a cumulative investment value of around $2.6 billion in the previous quarter.
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This article is originally published at Insider Monkey.
