Yahoo Finance Analysts Are Updating Their MarketAxess Holdings Inc. (NASDAQ:MKTX) Estimates After Its First-Quarter Results
Shareholders might have noticed that MarketAxess Holdings Inc. (NASDAQ:MKTX) filed its quarterly result this time last week. The early response was not positive, with shares down 2.1% to US$205 in the past week. MarketAxess Holdings reported US$210m in revenue, roughly in line with analyst forecasts, although statutory earnings per share (EPS) of US$1.92 beat expectations, being 2.6% higher than what the analysts expected. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
Check out our latest analysis for MarketAxess Holdings
Taking into account the latest results, the most recent consensus for MarketAxess Holdings from 14 analysts is for revenues of US$818.8m in 2024. If met, it would imply a credible 7.8% increase on its revenue over the past 12 months. Per-share earnings are expected to accumulate 4.0% to US$7.06. Before this earnings report, the analysts had been forecasting revenues of US$829.8m and earnings per share (EPS) of US$7.27 in 2024. The analysts seem to have become a little more negative on the business after the latest results, given the minor downgrade to their earnings per share numbers for next year.
It might be a surprise to learn that the consensus price target was broadly unchanged at US$242, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values MarketAxess Holdings at US$310 per share, while the most bearish prices it at US$183. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. The analysts are definitely expecting MarketAxess Holdings' growth to accelerate, with the forecast 10% annualised growth to the end of 2024 ranking favourably alongside historical growth of 8.7% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 5.5% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect MarketAxess Holdings to grow faster than the wider industry.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for MarketAxess Holdings. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. The consensus price target held steady at US$242, with the latest estimates not enough to have an impact on their price targets.
With that in mind, we wouldn't be too quick to come to a conclusion on MarketAxess Holdings. Long-term earnings power is much more important than next year's profits. We have forecasts for MarketAxess Holdings going out to 2026, and you can see them free on our platform here.
Before you take the next step you should know about the 1 warning sign for MarketAxess Holdings that we have uncovered.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
