MarketAxess Holdings Inc.
MarketAxess Holdings Inc. Fundamental Analysis
MarketAxess Holdings Inc. (MKTX) shows moderate financial fundamentals with a PE ratio of 26.86, profit margin of 29.17%, and ROE of 18.78%. The company generates $0.9B in annual revenue with moderate year-over-year growth of 8.58%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 76.5/100 based on profitability, valuation, growth, and balance sheet metrics. The B grade reflects solid fundamentals with room for improvement in valuation or growth.
Fundamental Health Score
We analyze MKTX's fundamental strength across five key dimensions:
Efficiency Score
ExcellentMKTX demonstrates superior asset utilization.
Valuation Score
WeakMKTX trades at a premium to fair value.
Growth Score
ModerateMKTX shows steady but slowing expansion.
Financial Health Score
ExcellentMKTX maintains a strong and stable balance sheet.
Profitability Score
ExcellentMKTX achieves industry-leading margins.
Key Financial Metrics
Is MKTX Expensive or Cheap?
P/E Ratio
MKTX trades at 26.86 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, MKTX's PEG of 2.05 indicates potential overvaluation.
Price to Book
The market values MarketAxess Holdings Inc. at 5.79 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 15.73 times EBITDA. This signals the market has high growth expectations.
How Well Does MKTX Make Money?
Net Profit Margin
For every $100 in sales, MarketAxess Holdings Inc. keeps $29.17 as profit after all expenses.
Operating Margin
Core operations generate 40.39 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $18.78 in profit for every $100 of shareholder equity.
ROA
MarketAxess Holdings Inc. generates $13.65 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
MarketAxess Holdings Inc. generates strong operating cash flow of $226.85M, reflecting robust business health.
Free Cash Flow
MarketAxess Holdings Inc. generates strong free cash flow of $183.55M, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $4.91 in free cash annually.
FCF Yield
MKTX converts 2.68% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
26.86
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
2.05
vs 25 benchmark
P/B Ratio
Price to book value ratio
5.79
vs 25 benchmark
P/S Ratio
Price to sales ratio
7.95
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.25
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.84
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.19
vs 25 benchmark
ROA
Return on assets percentage
0.14
vs 25 benchmark
ROCE
Return on capital employed
0.28
vs 25 benchmark
How MKTX Stacks Against Its Sector Peers
| Metric | MKTX Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 26.86 | 18.86 | Worse (Expensive) |
| ROE | 18.78% | 847.00% | Weak |
| Net Margin | 29.17% | 4202.00% | Weak |
| Debt/Equity | 0.25 | 0.91 | Strong (Low Leverage) |
| Current Ratio | 1.84 | 667.17 | Neutral |
| ROA | 13.65% | -21543.00% (disorted) | Strong |
MKTX outperforms its industry in 2 out of 6 key metrics, particularly excelling in ROA, but lagging in P/E Ratio.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews MarketAxess Holdings Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
57.59%
Industry Style: Value, Dividend, Cyclical
High GrowthEPS CAGR
31.97%
Industry Style: Value, Dividend, Cyclical
High GrowthFCF CAGR
42.87%
Industry Style: Value, Dividend, Cyclical
High Growth