As the craze of earnings season draws to a close, here’s a look back at some of the most exciting (and some less so) results from Q2. Today, we are looking at financial exchanges & data stocks, starting with Nasdaq (NASDAQ: NDAQ).
Financial exchanges and data providers operate trading platforms and sell market information. They enjoy relatively stable revenue from trading fees and subscriptions, increasing demand for data analytics, and expansion opportunities in emerging markets. Challenges include regulatory oversight of market structure, competition from alternative trading venues, and substantial technology investments needed to maintain low-latency trading infrastructure and data security.
The 9 financial exchanges & data stocks we track reported a mixed Q2. As a group, revenues beat analysts’ consensus estimates by 1%.
Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 6% since the latest earnings results.
Nasdaq (NASDAQ: NDAQ)
Originally founded in 1971 as the world's first electronic stock market, Nasdaq (NASDAQ: NDAQ) operates global exchanges and provides technology, data, and corporate services that help companies, investors, and financial institutions navigate capital markets.
Nasdaq reported revenues of $1.31 billion, up 12.7% year on year. This print exceeded analysts’ expectations by 2.1%. Overall, it was a strong quarter for the company with a decent beat of analysts' revenue estimates.
Adena Friedman, Chair and CEO said, “Nasdaq delivered an excellent second quarter performance amid a dynamic market environment. Our ability to deliver broad-based growth through cycles is testament to our role as a partner to our clients, helping them capture strategic opportunities, manage risk, and solidify their operational resilience.
Interestingly, the stock is up 6.5% since reporting and currently trades at $94.11.
Is now the time to buy Nasdaq? Access our full analysis of the earnings results here, it’s free.
Best Q2: Moody's (NYSE: MCO)
Founded in 1900 during America's railroad boom when investors needed reliable information on bond risks, Moody's (NYSE: MCO) provides credit ratings, risk assessment tools, and analytical solutions that help organizations evaluate financial risks and make informed investment decisions.
Moody's reported revenues of $1.90 billion, up 4.5% year on year, outperforming analysts’ expectations by 2.9%. The business had a strong quarter with revenue and EPS exceeding expectations.
Moody's scored the biggest analyst estimates beat among its peers. However, the results were likely priced into the stock as it’s traded sideways since reporting. Shares currently sit at $497.51.
Is now the time to buy Moody's? Access our full analysis of the earnings results here, it’s free.
Weakest Q2: Tradeweb Markets (NASDAQ: TW)
Founded in 1996 as one of the pioneers in electronic bond trading, Tradeweb Markets (NASDAQ: TW) builds and operates electronic marketplaces that connect financial institutions for trading across rates, credit, equities, and money markets.
Tradeweb Markets reported revenues of $513 million, up 26.7% year on year, in line with analysts’ expectations. It was a slower quarter as it posted a significant miss of analysts’ EPS estimates.
As expected, the stock is down 10.3% since the results and currently trades at $124.
Read our full analysis of Tradeweb Markets’s results here.
MarketAxess (NASDAQ: MKTX)
Pioneering the shift from phone-based to electronic bond trading since 2000, MarketAxess (NASDAQ: MKTX) operates electronic trading platforms that enable institutional investors and broker-dealers to efficiently trade fixed-income securities like corporate and government bonds.
MarketAxess reported revenues of $219.5 million, up 11% year on year. This number met analysts’ expectations. Aside from that, it was a mixed quarter as it also produced a narrow beat of analysts’ EPS estimates.
MarketAxess had the weakest performance against analyst estimates among its peers. The stock is down 12.5% since reporting and currently trades at $182.
Read our full, actionable report on MarketAxess here, it’s free.
FactSet (NYSE: FDS)
Founded in 1978 when financial data was still primarily delivered through paper reports, FactSet (NYSE: FDS) provides financial data, analytics, and technology solutions that investment professionals use to research, analyze, and manage their portfolios.
FactSet reported revenues of $585.5 million, up 5.9% year on year. This result beat analysts’ expectations by 0.7%. Zooming out, it was a mixed quarter as it also recorded a miss of analysts’ EPS estimates.
The stock is down 13% since reporting and currently trades at $368.
Read our full, actionable report on FactSet here, it’s free.
Market Update
In response to the Fed’s rate hikes in 2022 and 2023, inflation has been gradually trending down from its post-pandemic peak, trending closer to the Fed’s 2% target. Despite higher borrowing costs, the economy has avoided flashing recessionary signals. This is the much-desired soft landing that many investors hoped for. The recent rate cuts (0.5% in September and 0.25% in November 2024) have bolstered the stock market, making 2024 a strong year for equities. Donald Trump’s presidential win in November sparked additional market gains, sending indices to record highs in the days following his victory. However, debates continue over possible tariffs and corporate tax adjustments, raising questions about economic stability in 2025.
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