Investors don’t always need to scrape through lists of bombed out stocks to find compelling value.

High quality businesses can become cheaper even as their share prices advance. Market leading credit bureau Experian (EXPN) is one such stock, in our view.

Shares in the Dublin-headquartered business have gained from less than 300p in 2008 to more than £11.00 a share today, while at the same time paying a dividend well covered by earnings.

But Experian’s business value, as measured by its enterprise value to operating profit (EV/EBIT) ratio is 17 today which is pretty much the same as its long-term average. In a market where commentators complain financial assets are overpriced, examples like this are rare indeed.

For this reason, as well as its under-the-radar appeal and wide economic moat, we continue to rate Experian as a solid growth-at-a-reasonable-price pick ahead of interim results on 10 November.

Big data

Booming usage of connected devices - there were 1.4 billion smartphones globally in 2014 - combined with a reduction in the cost of consuming data is creating an information boom. Average monthly data consumption increased from 149 megabytes a month in 2008 to 3,391 megabytes in 2015.

A wall of data is hitting businesses as they deal with customers online. And Experian is an expert in analysing information to help business make faster and better decisions.

‘Experian holds around 30 Petrabytes of data globally and this is growing at about 20% a year,’ the company says in a document, Harnessing the power of Big Data.

‘This digital treasure trove is a highly valued way to meet the needs of customers and spot trends.’

These capabilities, as well as their potential, is not always well recognised by the market. Experian is listed as a support services stock, rather than a technology business. Speaking to one technology fund manager earlier this year, Shares asked what their view was of Experian. The answer? The fund manager had never heard of them.

That’s despite owning shares in US Big Data specialist Splunk (SPLK:NDQ), valued at less than half Experian’s market cap.

Experian is best known for its long-established credit services division, which provides credit checks to help lenders make better loans. It ranks number one or two in most of the markets it operates in and represented 65% of operating profit in the year to 31 March 2015.

Longer term, Shore Capital analyst Robin Speakman expects data services to form a more meaningful share of Experian’s profit and financial services to contribute less.

Usage this of data is highly regulated and Experian’s operating history and compliance in this area also contributes to its economic moat.

Growth: MEDIUM

Management's target of mid single-digit organic revenue growth has come under pressure recently, with just 1% growth at constant exchange rates in 20114/15

Risk: MEDIUM

Experian was subject of a data breach in October and there are also risks around a poor performing acquired unit in Brazil and retrenchment in the US

Quality: HIGH

Market leader in the credit bureau industry, Experian possesses a wide economic moat. Management has strong capital discipline and looks to build shareholder value.

Mobile risks

Risks include the increasing usage of mobile web browsers, which Speakman says Experian’s primarily web-based platform is struggling to adapt to and may weigh on growth. A recent data breach at one of Experian’s customers, T-Mobile (PCS:NYSE), also provided a dent to its reputation.

‘We believe that until the engines of growth, post currency translation, visibly begin to impact upon forecasts (we believe now potentially not until the fourth quarter, January to March 2016) the shares may struggle to make headway,’ Speakman wrote in a 5 October note.

EXPERIAN (EXPN) £11.17

Stop loss: £8.94

Market value: £10.7 billion

Prospective PE Mar 2016: 19.1

Prospective PE Mar 2017: 17.7

Prospective dividend yield: 3.6%

Bid/offer spread: 0.09%

Analyst price target: £12.53*

*Average broker price target, Thomson Reuters