Today’s Daily Alert features a recommendation from Stock Prospector, followed by a sell alert from BI Research.
“MarketAxess Holdings, Inc. (MKTX, $39) reported 4Q results with sales up 12% to $50.4 million, with earnings of $0.36 per share. Full year revenues were up 9% to $198.2 million and earnings were up 14% to $1.41. CEO Rick McVey commented on the results: ‘The 2012 full year results show continued growth in trading volume, revenue and earnings in our core products. Our free cash flow is allowing us to make valuable investments in new electronic marketplaces at the same time that we are returning more capital to our investors through increased dividends and share repurchases. 2013 will be an important year to maintain growth in our core business while simultaneously investing in new long-term growth opportunities in Europe open trading and derivatives. We believe the investment areas will significantly increase our addressable market in the years ahead.’
“MKTX provides a global electronic trading platform for investment professionals to trade corporate bonds, other fixed-income products and credit default swaps. MKTX has increased sales by 17% annually over the past five years, while profits are up 48% annually over the same period.
“I’m raising my earnings estimates and P/E ratio to $1.70 in 2013 and $2.25 in 2013. With a P/E ratio of 24x, my 12-18 month target price is $54.00. Speculative Buy.”
- Eric Dany, Stock Prospector, February 22, 2013