Broker snap: Experian well placed

9th Dec 2009 13:31

Swiss bank UBS has taken the findings of its survey of US financial services and applied them to credit rating agency Experian's prospects in what is a key sector for the company, and reckons the UK company is 'well placed'.UBS estimates financial services in the US accounts for more than 15% of group sales and more than 25% of earnings before interest, tax, depreciation and amortisation, 'but we believe it is a more important driver for the stock than these percentages would suggest.'The good news is that respondents to UBS's survey displayed 'cautious optimism' and 'expect to increase spend with US consumer credit info providers during 2010.''New US regulations seem as much an opportunity as a threat to demand for Experian's services, with lenders planning to tighten lending standards, but also to increase 'risk-based' pricing. Our survey suggests Experian is well placed to meet the criteria that matter most to customers,' UBS said.The Swiss bank has upgraded its full year 2011/12 earnings estimates to 'reflect somewhat greater confidence on US turnaround.' It has retained its 'buy' recommendation and upped its price target to 700p.