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MarketAxess (MKTX) Soars 4%: Is Further Upside Left in the Stock?

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MarketAxess (MKTX - Free Report) shares ended the last trading session 4% higher at $504.37. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock's 14.4% loss over the past four weeks.

The upside was attributable to strong February trading volumes. Its total monthly trading volume of $610.4 billion for February reflects an improvement of 3.1% year over year. The same also increased 6.1%, sequentially. Further, its average daily volume (ADV) for the month grew 3.1% year over year.

The company’s strong volumes for February reflect its accelerating market share gains, robust credit market volumes and a global shift among dealers and investors toward fixed income trading automation.

Price and Consensus

Price Consensus Chart for MarketAxess

This operator of bond trading platforms is expected to post quarterly earnings of $2.21 per share in its upcoming report, which represents a year-over-year change of +12.8%. Revenues are expected to be $196.06 million, up 16% from the year-ago quarter.

Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.

For MarketAxess, the consensus EPS estimate for the quarter has been revised 1.7% higher over the last 30 days to the current level. And a positive trend in earnings estimate revision usually translates into price appreciation. So, make sure to keep an eye on MKTX going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank 3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

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