Experian Remains a Top Long-Term Pick – JPMorgan

Experian's (LON: EXPN) US Insurance Marketplace business continues to exceed expectations, with JPMorgan reaffirming its bullish stance on the stock in a note to clients this week.

The bank’s analysts told investors that they see the division as a prime example of Experian’s innovative approach, helping drive long-term organic growth while supporting margin expansion and strong free cash flow (FCF).

JPMorgan noted that while the Insurance Marketplace currently contributes just 1% of revenue, it added approximately 100 basis points to group growth in the fourth quarter of 2024, punching far above its weight. 

“Experian remains our top long-term pick in the Business Services sector,” JPMorgan stated.

Experian’s Insurance Marketplace in the US  integrates Gabi, an online insurance agency licensed in all 50 states, with its auto data database—a resource only rivalled by S&P Mobility—and its consumer reach of 70 million free members. 

According to JPMorgan, this creates high barriers to entry, distinguishing Experian from traditional insurance comparison websites.

The division’s appeal is said to be in cost-effective customer acquisition for insurers. “The key proposition to the insurance carriers is that they can acquire new policies cheaper than they would by spending marketing dollars or using a traditional agent or broker,” JPMorgan noted. 

They add that consumers benefit from a simple, three-click process, transparent pricing, and pre-approved offers from 40 insurance carriers, including three of the top five in the US.

Looking ahead, Experian’s management believes the Insurance Marketplace could grow fourfold, potentially matching the size of its credit marketplace business. JPMorgan’s own analysis supports this projection, with analysts stating, “We see no real impediment to the business being bigger.”

JPMorgan concludes that with digital marketing spend by US insurers projected at $12 billion in 2025, Experian’s $100 million revenue run rate suggests a market share of less than 1%, leaving ample room for expansion.