What Are Analysts Saying About MarketAxess Holdings Inc’s (NASDAQ:MKTX) Earnings Trajectory?
In September 2017, MarketAxess Holdings Inc (NASDAQ:MKTX) released its latest earnings announcement, which revealed that the company benefited from a robust tailwind, leading to a double-digit earnings growth of 31.38%. Investors may find it useful to understand how market analysts perceive MarketAxess Holdings’s earnings growth outlook over the next couple of years and whether the future looks even brighter than the past. I will be using net income excluding extraordinary items in order to exclude one-off volatility which I am not interested in. Check out our latest analysis for MarketAxess Holdings
Market analysts’ prospects for this coming year seems buoyant, with earnings climbing by a robust 18.26%. This growth seems to continue into the following year with rates arriving at double digit 43.20% compared to today’s earnings, and finally hitting $250.0M by 2021.
Even though it’s useful to be aware of the growth rate each year relative to today’s value, it may be more insightful to determine the rate at which the earnings are moving every year, on average. The benefit of this approach is that it ignores near term flucuations and accounts for the overarching direction of MarketAxess Holdings’s earnings trajectory over time, which may be more relevant for long term investors. To calculate this rate, I’ve appended a line of best fit through the forecasted earnings by market analysts. The slope of this line is the rate of earnings growth, which in this case is 18.60%. This means, we can presume MarketAxess Holdings will grow its earnings by 18.60% every year for the next couple of years.
Next Steps:
For MarketAxess Holdings, I’ve put together three important aspects you should further research:
1. Financial Health: Does it have a healthy balance sheet? Take a look at our free balance sheet analysis with six simple checks on key factors like leverage and risk.
2. Valuation: What is MKTX worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether MKTX is currently mispriced by the market.
3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of MKTX? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.
