Shares of CoreLogic, Inc.CLGX have gained 8% over the past year against 0.8% decline of the industry it belongs to.
Let’s delve deeper into the factors, which have contributed to the company’s outperformance.
Consecutive Earnings & Revenue Beat
CoreLogic came up with better-than-expected earnings and revenue performance in the last four quarters. While the top line benefited from strength in the company’s core mortgage and insurance and spatial solutions, the bottom line was aided by revenue growth, operating leverage, better business mix and cost efficiency programs.
Operational Efficacy
CoreLogic is focused on operational excellence. Notably, during first-quarter 2020, adjusted EBITDA of $130 million improved 33% year over year. Adjusted EBITDA margin was 29%, up 600 basis points (bps). Operating income of $67 million soared more than 100% and operating margin increased a whopping 1000 bps to 15%.
It targets at least 30% adjusted EBITDA margin during 2020 by managing costs, consolidating facilities, simplifying the organization and automating certain activities. This should keep the bottom line in good shape in the foreseeable future.
Strategic Acquisitions
Acquisitions have helped CoreLogic increase its market share in mortgage, real estate, insurance, capital markets, public sector and rental property markets. The company continues to explore acquisition opportunities that complement its strength and reduce risks. In 2018, CoreLogic acquired eTech Solutions, Breakaway Holdings, a la mode technologies and Symbility Solutions for total net cash of $219.6 million. In 2019, CoreLogic completed the acquisition of National Tax Search for total net cash of around $13.2 million. In 2020 so far, the company has completed the acquisition of Location, Inc., a leader in geographic data sciences and predictive, location-based analytics for businesses across the United States and Canada.
Zacks Rank and Other Stocks to Consider
CoreLogic currently carries a Zacks Rank #2 (Buy).
Some other top-ranked stocks in the broader Zacks Business Services sector are DocuSign, Inc. DOCU, SPS Commerce SPSC and SailPoint Technologies Holdings, Inc. SAIL. All the stocks carry a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The long-term expected earnings per share (three to five years) growth rate for DocuSign, SPS Commerce and SailPoint is 46.8%, 15% and 15%, respectively.
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CoreLogic, Inc. (CLGX) : Free Stock Analysis Report
SPS Commerce, Inc. (SPSC) : Free Stock Analysis Report
SailPoint Technologies Holdings, Inc. (SAIL) : Free Stock Analysis Report
DocuSign Inc. (DOCU) : Free Stock Analysis Report
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