Will Strong Credit Trading Volume Aid MarketAxess in Q2 Earnings?
The second-quarter earnings estimate has witnessed four upward estimate revisions against three downward movements over the past 30 days. Meanwhile, the Zacks Consensus Estimate for revenues is pegged at $218 million, implying 10.1% growth from the year-ago quarter's figure.
MKTX's Earnings Surprise History
MarketAxess' bottom line beat estimates in each of the trailing four quarters, the average surprise being 2.67%. This is depicted in the chart below:
MarketAxess Holdings Inc. Price and EPS Surprise
MarketAxess Holdings Inc. price-eps-surprise | MarketAxess Holdings Inc. Quote
What Our Quantitative Model Unveils for MarketAxess
Our proven model predicts an earnings beat for MarketAxess this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is the case here.
Earnings ESP: MarketAxess has an Earnings ESP of +0.95% because the Most Accurate Estimate of $1.96 per share is pegged higher than the Zacks Consensus Estimate of $1.94. You can uncover the best stocks before they're reported with our Earnings ESP Filter.
Zacks Rank: MKTX currently carries a Zacks Rank of 3.
Factors Likely to Shape MKTX's Q2 Results
Higher trading volumes and robust market share gains across most of MKTX's credit product lines are expected to have driven credit commission revenues for the second quarter. However, the upside is likely to have been partially offset by a reduction in average variable transaction fees.
We expect credit commission revenues to be $138.4 million in the to-be-reported quarter, which indicates an improvement of 8.4% year over year. Our estimate for the total credit volume indicates a 10% year-over-year increase.
Solid trading volumes in the international business, coupled with higher revenues from MarketAxess' new product areas like emerging markets, municipals and U.S. government bonds, are expected to have contributed to its overall commission growth in the second quarter.
The Zacks Consensus Estimate for commissions is pegged at $189 million, indicating 9.9% growth from the prior-year quarter's reported number. We expect it to grow 7.6% year over year.
The consensus estimate for second-quarter total trading volume is pegged at 2.9 million, indicating 33.3% growth from the prior-year quarter's reported figure. Our estimate is 2.5 million .
Increased utilization of its data product suite and new contracts is likely to have provided an impetus for information services revenues, one of MKTX's revenue components, in the to-be-reported quarter. The consensus mark for information services revenues is pinned at $13.4 million, which implies a 6.5% rise from the year-ago quarter's reported figure. We project it to be $13 million, up 3.5% year over year.
However, MKTX's margins are likely to have been hurt by an increase in operating expenses, resulting from continuous investments to upgrade trading and data capabilities. We forecast total expenses to be $125.7 million in the second quarter, indicating an increase of 8.1% year over year.
Other Stocks to Consider
Here are some other companies from the Finance space, which according to our model, have the right combination of elements to beat on earnings this time around:
Pagaya Technologies Ltd. PGY has an Earnings ESP of +2.19% and a Zacks Rank of 1 at present. You can see the complete list of today's Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for PGY's second-quarter earnings is pegged at 69 cents per share, which indicates a nearly seven-fold increase from the prior-year quarter.
Pagaya Technologies' earnings beat estimates in two of the trailing four quarters and missed the mark twice, the average surprise being 12.91%.
StepStone Group Inc. STEP currently has an Earnings ESP of +7.63% and a Zacks Rank of 3. The Zacks Consensus Estimate for STEP's second-quarter earnings is pegged at 44 cents per share, which implies a 8.3% decline from the year-ago quarter's figure.
StepStone's earnings beat estimates in three of the trailing four quarters and matched the mark once, the average surprise being 20.86%.
Americold Realty Trust, Inc. COLD has an Earnings ESP of +0.74% and a Zacks Rank of 3 at present. The Zacks Consensus Estimate for COLD's second-quarter earnings is pegged at 34 cents per share, which implies a 10.5% decrease from the year-ago quarter's figure.
Americold Realty's earnings beat estimates in two of the trailing four quarters, matched the mark once and missed the same in the remaining one occasion, the average surprise being 3.79%
Zacks Names #1 Semiconductor Stock
This under-the-radar company specializes in semiconductor products that titans like NVIDIA don't build. It's uniquely positioned to take advantage of the next growth stage of this market. And it's just beginning to enter the spotlight, which is exactly where you want to be.
With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $971 billion by 2028.
See This Stock Now for Free >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
MarketAxess Holdings Inc. (MKTX): Free Stock Analysis Report
Americold Realty Trust Inc. (COLD): Free Stock Analysis Report
StepStone Group Inc. (STEP): Free Stock Analysis Report
Pagaya Technologies Ltd. (PGY): Free Stock Analysis Report
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Globe and Mail
26 minutes ago
- Globe and Mail
Prediction: 1 Artificial Intelligence (AI) Stock Will Be Worth More Than Palantir Technologies and Nvidia Combined by 2030
Key Points Nvidia and Palantir are collectively worth $4.6 trillion today, and Meta Platforms has a reasonably good shot at surpassing that figure within five years. Meta Platforms is using artificial intelligence to strengthen its ad tech business, and the company is an early leader in the smart glasses market. Wall Street expects Meta's earnings to grow at 17% annually in the next three to five years, but analysts have regularly underestimated the company. 10 stocks we like better than Meta Platforms › Shares of Nvidia have advanced 29% year to date, leaving the chipmaker with a market value of $4.2 trillion. And shares of Palantir Technologies have surged 104% year to date, bringing its market value to $365 billion. That means the companies are collectively worth $4.6 trillion. I think Meta Platforms (NASDAQ: META) can surpass that figure in five years. The company is currently worth $1.9 trillion, so its market value needs to increase 150% to $4.7 trillion by 2030 to satisfy my prediction. In that scenario, the stock would return about 20% annually. My forecast is aggressive, but investors have good reason to think Meta is equal to the challenge. Here's why. Meta Platforms is using artificial intelligence to strengthen its ad tech business Meta Platforms owns three of the four most popular social media platforms in Facebook, Instagram, and WhatsApp as measured by monthly active users. Those three platforms also ranked among the four most downloaded social applications for mobile devices last year, meaning the company is successfully defending its dominant position in the industry. Meta currently earns the vast majority of its revenue from advertising. Its ad tech tools help brands reach consumers with relevant ads across its social media platforms, as well as third-party websites and mobile applications. What advertisers are willing to pay depends on user engagement and campaign performance, and the company is leaning on artificial intelligence (AI) to improve both metrics. CEO Mark Zuckerberg recently told analysts, "AI is significantly improving our ability to show people content that they're going to find interesting and useful." Improved recommendations led to a 5% increase in time spent on Facebook and a 6% increase in time spent on Instagram in the second quarter. Also, more brands used Meta's AI creative tools, leading to 3% more ad conversions on Facebook and 5% more on Instagram. Here's the bottom line: Meta Platforms is the second largest ad tech company, behind only Alphabet 's Google, and it is successfully using AI to strengthen its value proposition for consumers and brands. Ad tech spending is forecast to increase at 14% annually through 2030, according to Grand View Research. That gives Meta a good shot at similar earnings growth within its advertising segment. Meta Platforms dominates the burgeoning smart glasses market Meta Platforms is currently the leading supplier of smart glasses. The company accounted for over 60% of shipments last year as the market tripled in size. And growth is projected to remain robust in the years ahead. Counterpoint Research says smart glasses shipments will grow faster than 60% annually through 2029. Other analysts are a little less optimistic. Grand View Research estimates smart glasses sales will increase at 27% annually through 2030. Nevertheless, CEO Mark Zuckerberg thinks smart glasses could slowly replace smartphones (or at least reduce their importance) in the next 15 years, especially once lenses are embedded with augmented reality displays. That could make Meta Platforms the Apple of the 2030s. To elaborate, whereas Apple was a sensational investment over the past two decades in large part because of the success of the iPhone, Meta could see similar success in the next two decades if smart glasses do indeed become the form factor of choice in personal computing and mobile communications. Why Meta Platforms could be worth $4.7 trillion by 2030 To summarize, Meta Platforms is using artificial intelligence to strengthen its advertising business, and the company is also an early leader in the smart glasses market. In turn, Wall Street analysts expect its earnings to grow at 17% annually over the next three to five years. That makes the current valuation of 27 times earnings look reasonable. However, Meta Platforms beat the consensus earnings estimate by an average of 18% in the last four quarters, meaning Wall Street has routinely underestimated the company. If that trend continues, earnings could grow at 21% annually over the next five years, in which case its market value could hit $4.7 trillion (more than Nvidia and Palantir combined today) while its valuation fell to 26 times earnings. Importantly, while I am moderately confident in the scenario I've outlined, Meta Platforms is still a smart long-term investment even if its market value does not reach $4.7 trillion in five years. Patient investors should consider buying a small position today. Should you invest $1,000 in Meta Platforms right now? Before you buy stock in Meta Platforms, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Meta Platforms wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $624,823!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,064,820!* Now, it's worth noting Stock Advisor's total average return is 1,019% — a market-crushing outperformance compared to 178% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of August 4, 2025
CBC
27 minutes ago
- CBC
Here's how Trump's tariffs are starting to cost Americans
Little by little, the costs of U.S. President Donald Trump's tariffs are starting to show for American businesses and consumers. News of the tariff impact is mounting, from the Detroit Three automakers announcing they'll face extra costs this year totalling into the billions, to the stainless steel cookware manufacturer in Tennessee hit with a $75,000 (US) tariff bill on one shipment, right down to the coffee shops considering boosting the price of a cup because of tariffs on Brazil. Until recently, companies have somewhat shielded U.S. consumers from the full effects of the tariffs, either by rushing supplies into the country ahead of Trump's deadlines, or absorbing the levies as a cost of doing business. But with tariffs on imports from roughly 100 U.S. trading partners due to rise this week from their current baseline of 10 per cent, tariff-related costs are headed nowhere but up. Alex Durante, senior economist of the Tax Foundation, a Washington-based policy and advocacy group, says the tariffs are hitting a broad range of U.S. businesses that rely on imports. "I think the administration is going to have a really hard time trying to convince the American people that some of the price increases they're seeing are because of other factors not related to the tariffs," Durante said in an interview with CBC News. "I just don't think most people are going to be fooled by that," he said. WATCH | Carney's point man on tariffs takes Canada's message to U.S. television: Canadian officials confident U.S. trade deal will be reached 1 day ago Prime Minister Mark Carney and Dominic LeBlanc, the minister responsible for Canada-U.S. trade, expressed confidence a new trade deal will be reached with the United States, even after 35 per cent tariffs were imposed late last week. Trump, cabinet deny tariffs costing Americans While on a macro level the U.S. economy is generally chugging along just fine despite Trump's tactics, there's some fresh data suggesting the tariffs are acting as a drag, including: weak jobs numbers; rising core inflation; a sharp drop in orders of durable goods, such as appliances and automobiles. Trump and his cabinet members quickly brush aside any evidence that the tariffs are costing Americans, with the president even firing the head of the federal statistics agency that produces the country's employment report. "We have a lot of money coming in, much more money than the country has ever seen, by hundreds of billions of dollars," Trump said Sunday when a reporter asked about tariffs. U.S. Trade Representative Jamieson Greer flat-out denied that Trump's tariffs policies are a factor in the jobs slump. "I don't read tariff policy into that number," Greer told the CBS program Face the Nation on Sunday. But if you're willing to look around, you can find plenty of examples of U.S. businesses feeling the pinch. Reuters news agency is compiling examples of how major companies around the world are responding to Trump's tariffs, such as hiking prices and issuing profit warnings. Retailers, big brands raising prices The Reuters tracker currently shows 22 U.S. companies raising prices, including retail giants (WalMart, Best Buy), footwear brands (Nike, Crocs, Birkenstock) and big-name makers of household goods (Colgate-Palmolive, Procter & Gamble, Clorox). It's hard to imagine many American consumers haven't bought something from those businesses this year. Other big-name U.S. firms have in recent days reported tariff impacts. Tech giant Apple says it faced $800 million in tariff-related costs last quarter alone, and expects that to rise to $1.1 billion this quarter. Warren Buffett's Berkshire Hathaway blames tariffs in part for a 5.1 per cent quarterly decline in revenue in its consumer goods division, which includes brands like Fruit of the Loom and Tool manufacturer Stanley Black & Decker estimates its tariff costs will hit $800 million this year. Those corporate figures don't touch on another trend emerging in the U.S. economy: the downturn in visits by international travellers, dramatically so from Canada. Perhaps that's not exactly tariff-related, but Trump slamming other nations on trade by describing them as nasty, unfair and ripping off the U.S. is not exactly what you'd call a warm and welcoming tourism ad campaign either. WATCH | This economist says Canada has a better deal on Trump's tariffs than other countries: Economist Robert Embree on the impact of U.S. tariffs on the Canadian economy 2 days ago Higher prices could impact public opinion While some polling suggests more Americans disapprove of tariffs than approve, the issue does not appear to be a crucial source of public-opinion damage to Trump and the Republicans — at least not yet. That could change if the tariff costs on businesses accumulate so much that consumers can't help but see the impact. "We know from the most recent presidential election that voters really disliked seeing higher prices," said Durante. He sees trouble ahead whether businesses pass along all, some or none of the extra tariff costs to consumers. "If they're absorbing the price increases, that's less money that they could use to invest in their own businesses and jobs and further production," Durante said.
Globe and Mail
an hour ago
- Globe and Mail
Here's Why Energy Transfer Stock Is a Buy Before Aug. 6
Key Points Energy Transfer will report its second-quarter financial results on Wednesday. The MLP could also reveal that it has secured additional expansion projects. This week is the last time to buy Energy Transfer to receive its next distribution payment. 10 stocks we like better than Energy Transfer › This is a big week for Energy Transfer (NYSE: ET). The energy midstream giant reports its second-quarter financial results this week. Additionally, it will pay its next quarterly distribution to investors who hold shares by the end of the week. Given the timing of these pending catalysts, investors who are thinking about buying Energy Transfer should consider doing so before the market closes on Aug. 6. Here's why that's a noteworthy date. Earnings are coming Energy Transfer announced that it plans to release its second-quarter financial results after the market closes on Wednesday, Aug. 6. That report could serve as a catalyst for the master limited partnership's (MLP) unit price, which has declined by about 10% this year. A strong second-quarter report could provide a jolt that reinvigorates the company's unit price. The midstream giant is coming off a solid quarter. Its earnings before interest, taxes, depreciation, and amortization (EBITDA) rose nearly 6% in the first quarter to $4.1 billion, though its distributable cash flow slipped 2% to $2.3 billion. The company delivered record interstate natural gas transportation volumes (up 3%) and strong crude oil volume growth (10% increase). It benefited from healthy market conditions and the impact of last year's acquisition of WTG Midstream. Its second-quarter financial results should start seeing the initial benefits of a major wave of organic expansion projects. The company has completed the initial phases of some Permian processing plant upgrades, its Sabina 2 Pipeline conversion, and ethane and propane services at its Nederland Flexport NGL Expansion project. It's also completing several natural gas-fired electric generation facilities to support its operations in Texas. These projects should have started supplying the MLP with incremental earnings and cash flow in the second quarter, potentially accelerating its growth rate. New growth catalysts coming? Another potential upside catalyst that could emerge with Energy Transfer's earnings report is the unveiling of new growth drivers. For example, the MLP has several proposed expansion projects that are on the cusp of reaching a final investment decision (FID). The biggest is its long-delayed Lake Charles LNG project. The company already announced two major new developments related to that project over the past few months. Energy Transfer secured several new customer contracts supporting the project, including an expansion of its agreement with Chevron. Additionally, the MLP secured MidOcean Energy as a joint venture partner to help fund the project. Announcing that it has finally made an FID on this project could provide the MLP's unit price with a big boost. Energy Transfer is also working on several potential projects to supply natural gas to artificial intelligence (AI) data centers, including a previously proposed project for Cloudburst's AI data center. Formally securing that project and others linked to AI data centers could also be a major catalyst for the unit price. The last chance to lock in the next distribution payment This week is also an important one for income-focused investors. Energy Transfer will pay its next quarterly distribution on Aug. 19. However, investors need to own units of the MLP by the time the market closes on Friday, Aug. 8. If you buy units after that date, you won't receive your first distribution payment until mid-November, when the company will likely make its third-quarter payment. Energy Transfer's upcoming quarterly payment will be $0.33 per unit ($1.32 annualized). This rate gives it a distribution yield of 7.4% at its recent unit price. The payment is up from $0.3275 last quarter ($1.31 annualized) and a more than 3% increase compared to its payment in the second quarter of last year. The MLP has been bumping up its payment each quarter, aiming to raise it by 3% to 5% annually. The energy company's high-yielding and steadily rising distribution makes it a great investment option for those seeking to generate passive income. However, it's worth noting that the MLP sends its investors a Schedule K-1 federal tax form each year, which can complicate your taxes. It's essential to understand the benefits and drawbacks of investing in MLPs, such as Energy Transfer, before purchasing units for your portfolio. A big week for Energy Transfer Investors who are thinking about buying units of Energy Transfer should consider making the trade before the market closes on Aug. 6. That way, they would hold shares before its upcoming earnings report and distribution payment. Should you invest $1,000 in Energy Transfer right now? Before you buy stock in Energy Transfer, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Energy Transfer wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $624,823!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,064,820!* Now, it's worth noting Stock Advisor's total average return is 1,019% — a market-crushing outperformance compared to 178% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of August 4, 2025
