MarketAxess Q2 revenue slightly beats estimates; to be acquired by Intercontinental Exchange
MKTX•Drivers of the quarter
- U.S. credit weakness - Commission revenue fell 3%, mainly due to a 9% decline in U.S. credit, attributed to lower market volatility and changes in product mix.
- Emerging markets and services growth - Growth in emerging markets commission revenue (+6%) and record services revenue (+14%) helped offset declines in U.S. credit.
- Block and portfolio trading - Strong growth in block trading ADV (+11%) and portfolio trading ADV (+33%) supported results, especially in emerging markets and U.S. credit.
Key figures and analyst coverage
| Metric | Actual | Consensus Estimate |
|---|---|---|
| Q2 Revenue | $218.4 mln | $216.78 mln (9 Analysts) |
| Q2 Adjusted EPS | $1.95 | $1.85 (11 Analysts) |
| Q2 EPS | $1.93 | |
| Q2 Net Income | $68 mln | |
| Q2 EBITDA | $106 mln | |
| Q2 Operating Income | $89.88 mln | |
| Q2 Operating Margin | 41.10% | |
| Q2 Pretax Profit | $89.76 mln |
The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 4 "strong buy" or "buy", 10 "hold" and no "sell" or "strong sell". The average consensus recommendation for the financial & commodity market operators & service providers peer group is "buy."
Wall Street's median 12-month price target for Marketaxess Holdings Inc is $131.00, about 4.2% above its July 29 closing price of $125.73. The stock recently traded at 15 times the next 12-month earnings vs. a P/E of 20 three months ago.
