MarketAxess Stock Has Growth Potential In The Short-Term

MarketAxess Stock Has Growth Potential In The Short-Term

Share to Linkedin Despite the recent drop, MarketAxess' stock is trading above the level it was at before the drop in February 2020 due to the coronavirus outbreak becoming a pandemic. We feel that the company's stock still has potential as its revenues have benefited from the higher bond trading volumes and its valuation implies it has further to go. While the company's total revenues rose around 75% from $393 million in 2017 to about $689 million in 2020, it translated into a 102% increase in the net income figure. The net income margin also grew from 37. 6% to 43. 4% over the same period, primarily driven by higher revenues. MarketAxess' P/E multiple has changed from just above 50x in FY 2017 to close to 70x in FY 2020. While the company's P/E is around 55x now, there is some scope for an upside when the current P/E is compared to levels seen in the past years – P/E multiple of around 68x at the end of 2019 and 70x at the end of 2020. MarketAxess reported a strong performance in 2020 – revenues increased by 35% y-o-y to $689 million. This could be attributed to a 37% y-o-y