Nasdaq, Inc. (NDAQ - Free Report) reported second-quarter 2021 adjusted earnings per share of $1.90, beating the Zacks Consensus Estimate of $1.73 by 9.8%. The bottom line increased 23.4% year over year.
The improvement was primarily driven by organic growth, favorable changes in foreign exchange rates, margin expansion and solid segmental performance. Nasdaq noted that the solid results reflect strength of its diverse offerings and scalability of increasingly SaaS-oriented business model.
Nasdaq, Inc. Price, Consensus and EPS Surprise
Performance in Detail
Nasdaq’s revenues of $846 million increased 21% year over year. The upside was primarily attributable to a $104 million impact from organic growth, a $27 million increase from the inclusion of revenues from the acquisition of Verafin, and a $16 million increase from the impact of favorable changes in FX rates. The top line beat the Zacks Consensus Estimate by 2.7%.
Adjusted operating expenses were $392 million, up 20% from the year-ago period owing to a $24 million organic increase, a $26 million impact of the Verafin acquisition and a $15 million increase from changes in FX rates.
Operating margin of 54% expanded 100 basis points year over year.
Nasdaq witnessed 135 IPOs in the second quarter, representing $32 billion in capital raised, including 88 operating company IPOs and 47 IPOs of special purpose acquisition companies. In the reported quarter, the Nasdaq welcomed 264 new listings.
Segment Details
Net revenues at Market Services were up 13% from the year-ago quarter to $312 million. This upside was largely due to higher revenues from equity derivative trading and clearing, cash equity trading, fixed income and commodities trading and clearing, and trade management services.
Revenues at Corporate Services increased 22% year over year to $154 million, driven by higher listings services revenues as well as IR & ESG revenues.
Investment Intelligence revenues rose 23% year over year to $263 million. Higher market data, index and analytics revenues drove the upside.
Revenues at Market Technology increased 39% year over year to $117 million, largely due to higher revenues at marketplace infrastructure technology as well as anti-financial crime technology.
Financial Update
Nasdaq had cash and cash equivalents of $430 million as of Jun 30, 2021, down from $2.8 billion at 2020-end level. Long-term debt decreased 1.1% from 2020-end level to $5.5 billion as of Jun 30, 2021.
Capital Deployment
Nasdaq returned $579 million in the first half of 2021, including $410 million in share repurchases and $169 million in dividends.
As of Jun 30, 2021, Nasdaq had $1.459 billion remaining under its share repurchase authorization.
Guidance
Nasdaq provided 2021 non-GAAP operating expense guidance in the range of $1.59 billion to $1.62 billion.
Non-GAAP tax rate is still estimated to be in the range of 25% to 27% in 2021.
Zacks Rank
Nasdaq currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Upcoming Releases
CME Group Inc. (CME - Free Report) is slated to release second-quarter earnings on Jul 28. The Zacks Consensus Estimate for the bottom line is pegged at $1.59.
Intercontinental Exchange Inc. (ICE - Free Report) is scheduled to release second-quarter earnings on Jul 29. The Zacks Consensus Estimate for earnings is pegged at $1.16.
Cboe Global Markets, Inc. (CBOE - Free Report) is set to release second-quarter earnings on Jul 30. The Zacks Consensus Estimate for earnings is pegged at $1.35.
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Nasdaq, Inc. (NDAQ - Free Report) reported second-quarter 2021 adjusted earnings per share of $1.90, beating the Zacks Consensus Estimate of $1.73 by 9.8%. The bottom line increased 23.4% year over year.
The improvement was primarily driven by organic growth, favorable changes in foreign exchange rates, margin expansion and solid segmental performance. Nasdaq noted that the solid results reflect strength of its diverse offerings and scalability of increasingly SaaS-oriented business model.
Nasdaq, Inc. Price, Consensus and EPS Surprise
Performance in Detail
Nasdaq’s revenues of $846 million increased 21% year over year. The upside was primarily attributable to a $104 million impact from organic growth, a $27 million increase from the inclusion of revenues from the acquisition of Verafin, and a $16 million increase from the impact of favorable changes in FX rates. The top line beat the Zacks Consensus Estimate by 2.7%.
Adjusted operating expenses were $392 million, up 20% from the year-ago period owing to a $24 million organic increase, a $26 million impact of the Verafin acquisition and a $15 million increase from changes in FX rates.
Operating margin of 54% expanded 100 basis points year over year.
Nasdaq witnessed 135 IPOs in the second quarter, representing $32 billion in capital raised, including 88 operating company IPOs and 47 IPOs of special purpose acquisition companies. In the reported quarter, the Nasdaq welcomed 264 new listings.
Segment Details
Net revenues at Market Services were up 13% from the year-ago quarter to $312 million. This upside was largely due to higher revenues from equity derivative trading and clearing, cash equity trading, fixed income and commodities trading and clearing, and trade management services.
Revenues at Corporate Services increased 22% year over year to $154 million, driven by higher listings services revenues as well as IR & ESG revenues.
Investment Intelligence revenues rose 23% year over year to $263 million. Higher market data, index and analytics revenues drove the upside.
Revenues at Market Technology increased 39% year over year to $117 million, largely due to higher revenues at marketplace infrastructure technology as well as anti-financial crime technology.
Financial Update
Nasdaq had cash and cash equivalents of $430 million as of Jun 30, 2021, down from $2.8 billion at 2020-end level. Long-term debt decreased 1.1% from 2020-end level to $5.5 billion as of Jun 30, 2021.
Capital Deployment
Nasdaq returned $579 million in the first half of 2021, including $410 million in share repurchases and $169 million in dividends.
As of Jun 30, 2021, Nasdaq had $1.459 billion remaining under its share repurchase authorization.
Guidance
Nasdaq provided 2021 non-GAAP operating expense guidance in the range of $1.59 billion to $1.62 billion.
Non-GAAP tax rate is still estimated to be in the range of 25% to 27% in 2021.
Zacks Rank
Nasdaq currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Upcoming Releases
CME Group Inc. (CME - Free Report) is slated to release second-quarter earnings on Jul 28. The Zacks Consensus Estimate for the bottom line is pegged at $1.59.
Intercontinental Exchange Inc. (ICE - Free Report) is scheduled to release second-quarter earnings on Jul 29. The Zacks Consensus Estimate for earnings is pegged at $1.16.
Cboe Global Markets, Inc. (CBOE - Free Report) is set to release second-quarter earnings on Jul 30. The Zacks Consensus Estimate for earnings is pegged at $1.35.
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Biden or Trump? Zacks is releasing a FREE Special Report, Profit from the 2024 Presidential Election (no matter who wins).
Since 1950, presidential election years have been strong for the market. This report names 5 timely stocks to ride the wave of electoral excitement.
They include a medical manufacturer that gained +11,000% in the last 15 years… a rental company absolutely crushing its sector… an energy powerhouse planning to grow its already large dividend by 25%... an aerospace and defense standout that just landed a potentially $80 billion contract… and a giant chipmaker building huge plants in the U.S.
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