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Nasdaq Gears Up to Report Q3 Earnings: What's in the Cards?

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Nasdaq, Inc. (NDAQ - Free Report) is slated to report third-quarter 2024 earnings on Oct. 24, before the opening bell. The company delivered an earnings surprise in three of the last four reported quarters while missing in one.

Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.

Factors to Consider

Continued organic revenue growth, new sales, an increase in Financial Crime Management Technology revenues and contributions from the Adenza acquisition are likely to have aided Nasdaq’s third-quarter performance.

An increase in international demand is expected to have driven proprietary data revenues. Non-trading revenues are likely to have benefited from improved results in Capital Access Platforms, Financial Technology and Market Services businesses.

Price increases, new sales to existing clients and new customer acquisitions, particularly small and medium-sized businesses are likely to have aided the Financial Crime Management Technology business. The inclusion of revenues from Calypso associated with the acquisition of Adenza and higher trade management services revenues driven by demand for colocation and connectivity services and pricing are likely to have aided the Capital Markets Technology business. We expect Capital Markets Technology revenues to be $247.1 million.

Growth in trading volume on futures contracts linked to the Nasdaq-100 Index, higher Data Link sales and growth in eVestment product offerings are expected to have aided performance at the Capital Access Platforms division.

The Zacks Consensus Estimate for revenues is pegged at $1.16 billion, indicating a 23.7% increase from the prior-year reported figure. 

An increase in compensation and benefits, professional & contract services expenses, as well as technology and communication infrastructure, general and administrative expenses, marketing and advertising, depreciation and amortization and restructuring charges are likely to have increased total expenses for the to-be-reported quarter. We expect non-GAAP operating expenses to increase 22.4% year over year.

The continued share buyback is anticipated to have provided an additional boost to the bottom line.

The Zacks Consensus Estimate for earnings is pegged at 69 cents per share, indicating a 2.8% decrease from the prior-year reported figure.

Q3 Volumes

Nasdaq reported mixed volumes for the third quarter of 2024. The U.S. equity options volume increased 8.6% year over year to 858 million contracts. European options and futures volume decreased 12.4% year over year to 14.1 million contracts.

Revenues per contract for the U.S. equity options increased 8.3% year over year to 13 cents, while the same for European options and futures increased 9.3% to 47 cents.

Under its cash equities, Nasdaq’s U.S. matched equity volume in the third quarter grossed 118.2 billion shares, up 10.8% from the prior-year quarter’s level. European equity volume increased 16.7% year over year to $196 billion.
 
In the third quarter, there were 4,513 listed companies on the Nasdaq compared with 4,752 in the year-ago period. Total listings dropped 1.8% year over year to 5,225.

We expect data and listing services revenues to increase 0.9% to $189.6 million in the to-be-reported quarter.

What Our Quantitative Model States

Our proven model predicts an earnings beat for Nasdaq this time around. This is because the stock has the right combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold).

Earnings ESP: Nasdaq has an Earnings ESP of +0.51% at present. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Nasdaq, Inc. Price and EPS Surprise

Nasdaq, Inc. Price and EPS Surprise

Nasdaq, Inc. price-eps-surprise | Nasdaq, Inc. Quote

Zacks Rank: Nasdaq currently carries a Zacks Rank #3.

Other Stocks to Consider

Cboe Global Markets, Inc. (CBOE - Free Report) has an Earnings ESP of +1.12% and a Zacks Rank #3 at present. You can see the complete list of today’s Zacks #1 Rank stocks here. The Zacks Consensus Estimate for third-quarter 2024 earnings is pegged at $2.18 per share, indicating a year-over-year increase of 5.8%. 

CBOE’s earnings beat estimates in each of the last four quarters.

Intercontinental Exchange Inc. (ICE - Free Report) has an Earnings ESP of +0.82% and a Zacks Rank #2 at present. The Zacks Consensus Estimate for third-quarter 2024 earnings is pegged at $1.54 per share, indicating a year-over-year increase of 5.4%.

ICE’s earnings beat estimates in three of the last four quarters and matched in one.

Arch Capital Group Ltd. (ACGL - Free Report) has an Earnings ESP of +7.91% and a Zacks Rank #3 at present. The Zacks Consensus Estimate for third-quarter 2024 earnings is pegged at $1.98, indicating a year-over-year decrease of 14.2%.
 
ACGL’s earnings beat estimates in each of the last four reported quarters.

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