Nasdaq Q3 Earnings Beat on Higher Revs - Analyst Blog
October 23 2013 - 10:38AM
Zacks
Nasdaq OMX Group Inc. (NDAQ) reported
third-quarter 2013 operating earnings per share of 66 cents. The
result beat the Zacks Consensus Estimate as well as the year-ago
earnings figure by 4 cents.
Nasdaq’s total net operating exchange revenues increased 23% year
over year to $506 million, and beat the Zacks Consensus Estimate of
$502 million. On a constant currency basis and excluding
acquisitions, revenues grew 4% year over year in the reported
quarter.
The growth was primarily attributable to improved revenues from
listing, information, technology and derivatives, all driven by
both organic and inorganic attributes. Moreover, revenues from
market services witnessed improvement in the quarter.
Segment-wise, Market Services net exchange
revenues for the quarter increased 8.1% from the year-ago period to
$200 million, attributable to lower cost of revenues.
Listing Services revenues for the reported quarter
were $57 million, up 3.6% from the year-ago period, owing to
improved performance in the European markets. Revenues from
Information Services improved 19.2% to $119
million, whereas Technology Solutions revenues
stood at $131 million, surging 79% from the year-ago quarter.
During the reported quarter, Nasdaq’s order intakes improved to
$119 million from $34 million in the year-ago quarter.
Additionally, total order value (the value of orders signed that
have not been recognized as revenues) increased to $579 million
from $540 million in the prior-year quarter. New listings totaled
64 against 44 in the year-ago quarter.
Meanwhile, on a non-GAAP basis, operating expenses stood at $304
million, up 32% from the year-ago period. The upside was due to
expenses related to the acquisitions of Thomson Reuters' IR, PR and
Multimedia businesses and the eSpeed electronic fixed income
platform. Consequently, operating margin contracted 400 basis
points year over year to 40%.
Financial Update
As of Sep 30, 2013, Nasdaq had cash and cash equivalents of $381
million, down from $582 million at the end of 2012. Debt
obligations of Nasdaq stood at $2.67 billion, up from $1.84 billion
at 2012-end. However, Nasdaq paid $98 million of debt in the
reported quarter.
Total assets of Nasdaq increased to $12.5 billion from $9.13
billion at 2012-end, while total equity improved to $6.1 billion
from $5.2 billion at 2012-end.
Guidance
Management narrowed core operating expense projection to
$1.075–1.090 billion from $1.070-1.100 billion guided earlier.
Additionally, the company expects approximately $45 million of
incremental expenses from new initiative spending (down from the
earlier range of $50–$60 million). Including these charges, total
expenses are projected in the range of $1.120–$1.135 billion,
narrowed from the guidance of $1.12–1.16 billion provided
earlier.
Dividend
Concurrently, the board of directors of Nasdaq declared a cash
dividend of 13 cents per share, which is payable on Dec 27, 2013 to
shareholders of record as on Dec 13, 2013.
Other Strong Performers in the Finance Space
American Express Co. (AXP) reported its
third-quarter 2013 operating earnings per share of $1.25. The
result comfortably surpassed both the Zacks Consensus Estimate of
$1.22 and the year-ago quarter earnings of $1.09 a share.
Capital One Financial Corp.’s (COF) third-quarter
2013 earnings per share of $1.86 outpaced the Zacks Consensus
Estimate of $1.77.
Euronet Worldwide Inc. (EEFT) reported
third-quarter operating net income of 51 cents per share, beating
the Zacks Consensus Estimate of 48 cents and the year-ago figure of
38 cents.
Zacks Rank
Nasdaq currently carries a Zacks Rank #4 (Sell).
AMER EXPRESS CO (AXP): Free Stock Analysis Report
CAPITAL ONE FIN (COF): Free Stock Analysis Report
EURONET WORLDWD (EEFT): Free Stock Analysis Report
NASDAQ OMX GRP (NDAQ): Free Stock Analysis Report
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