Cloud Migration And AI Advancements Will Expand Compliance Reach

Key Takeaways

• Completion of technology modernization and an enhanced go-to-market approach are driving improved product mix, pricing, and deeper client relationships for long-term growth.
  
• Strong demand for compliance, risk analytics, and AI-powered solutions, along with recurring revenue expansion, supports sustainable revenue and margin stability.
  
• Ongoing strategic uncertainty, slow organic growth, high leverage, and legacy partnership exits threaten revenue momentum, margin expansion, and reduce investment flexibility.

Catalysts

Provides business to business data and analytics in North America and internationally.

• Completion of multi-year client migrations and sunsetting of legacy platforms in North America has established a modern, cloud-based tech stack, increasing solution stickiness, enabling better pricing alignment, and setting the stage for accelerated organic revenue growth and improved net margins from a higher-value product mix.
  
• Strong demand for compliance, risk analytics, and supply chain solutions-driven by ongoing regulatory requirements and global economic complexity-aligns with broad-based adoption of data-driven decision making and will support sustainable revenue expansion, especially as D&B brings new vertical and AI-enabled offerings to market.
  
• Enhanced go-to-market strategy with industry-specific verticals and deeper client engagement is expected to unlock greater cross-sell and upsell opportunities, improving client retention, driving incremental recurring revenue, and supporting long-term earnings growth.
  
• Expansion of API and cloud-native delivery models has increased ratable, recurring revenue (now ~75% of the mix), providing more stability and predictability to cash flows and margins as usage-based volatility diminishes over time.
  
• Advancements in generative AI offerings (such as Chat D&B), combined with D&B's proprietary, high-quality data assets, position the firm to capture incremental share from the accelerating integration of AI in business decisioning and compliance, likely boosting both top-line revenues and margins through premium, data-centric solutions.

Dun & Bradstreet Holdings Future Earnings and Revenue Growth

Assumptions

• Analysts are assuming Dun & Bradstreet Holdings's revenue will grow by 4.9% annually over the next 3 years.
• Analysts assume that profit margins will increase from -0.9% today to 9.0% in 3 years time.
• Analysts expect earnings to reach $248.9 million (and earnings per share of $0.51) by about July 2028, up from $-21.2 million today. However, there is a considerable amount of disagreement amongst the analysts with the most bullish expecting $292.2 million in earnings, and the most bearish expecting $213 million.
• In order for the above numbers to justify the analysts price target, the company would need to trade at a PE ratio of 21.3x on those 2028 earnings, up from -192.0x today. This future PE is lower than the current PE for the US Professional Services industry at 23.7x.
• Analysts expect the number of shares outstanding to grow by 1.05% per year for the next 3 years.
• To value all of this in today's terms, we will use a discount rate of 8.07%, as per the Simply Wall St company report.

Dun & Bradstreet Holdings Future Earnings Per Share Growth

Risks

• Heightened uncertainty and distraction from the ongoing strategic review process-evident in delayed deals, client hesitation, and employee concern-are disrupting operational execution and revenue realization, especially in the near term, with potential for continued pipeline delays, which could suppress both revenue and earnings.
  
• The exit from several legacy partnerships, while expected to improve EBITDA in the medium term, will create a $14 million revenue headwind in 2025 and possibly reduces broader market/channel access, which could limit sales growth, slow client acquisition, and weigh on revenue momentum.
  
• North America remains the primary revenue and margin contributor but posted less than 1% revenue growth and a 60 basis point EBITDA margin drop in 2024, reflecting higher costs and competitive pressure; persistent margin compression or inability to accelerate North American growth may pressure overall earnings.
  
• The company is still highly leveraged (3.6x net leverage, $3.55B in debt), which constrains investment capacity for innovation, M&A, or technological upgrades, exposes profitability to interest rate fluctuations, and could limit future margin expansion or flexibility during downturns.
  
• Despite long-term transformation efforts, organic growth remains modest (3–4% in recent quarters), and management's expectations for a faster acceleration to 5–7% are unproven, as reflected in the 2025 revenue guide (3–5% organic); continued slow growth or inability to reach higher targets could disappoint investors, limiting share price upside.

Valuation

• The analysts have a consensus price target of $9.15 for Dun & Bradstreet Holdings based on their expectations of its future earnings growth, profit margins and other risk factors.
• In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be $2.8 billion, earnings will come to $248.9 million, and it would be trading on a PE ratio of 21.3x, assuming you use a discount rate of 8.1%.
• Given the current share price of $9.12, the analyst price target of $9.15 is 0.3% higher. The relatively low difference between the current share price and the analyst consensus price target indicates that they believe on average, the company is fairly priced.
• We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.