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What's in Store for MarketAxess' (MKTX) Earnings in Q3?

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MarketAxess Holdings Inc. (MKTX - Free Report) is expected to witness a decline in earnings from the year-ago reported figure when it reports third-quarter 2021 earnings results on Oct 20, 2021.

Estimate Trend

The consensus estimate for September-quarter earnings of this operator of bond trading platforms is pegged at $1.51 per share, which indicates a decrease of 15.2% from the prior-year period’s reported number.

The consensus mark for revenues stands at $170.92 million, suggesting a 4.21% rise from the year-ago quarter’s reported figure.

Factors to Watch

MarketAxess already released total trading volume of $1.53 trillion for the third quarter, which was up 13% year over year but down 1.9%, sequentially.

MarketAxess earns commission and fees revenues on the bond trading executed on its platforms. Thus, increase in trading volumes is expected to have buoyed commission and fees revenues in the September quarter, which constitute 90% of the company’s top line.

Margins are likely to have been stressed by high expenses. The company expects total expenses for 2021 in the range of $370-$386, indicating a rise from the previous projection of $362-$382 million.

Earnings Surprise History

The company’s earnings beat estimates in three of the last four quarters (missed the mark in one), the average surprise being 2.75%. This is depicted in the chart below:

MarketAxess Holdings Inc. Price and EPS Surprise

MarketAxess Holdings Inc. Price and EPS Surprise

MarketAxess Holdings Inc. price-eps-surprise | MarketAxess Holdings Inc. Quote

Here is what our quantitative model predicts:

Our proven model does not predict an earnings beat for MarketAxess this time around. The combination of a positive  Earnings ESP  and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat, which is not the case here. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

Earnings ESP:  MarketAxess has an Earnings ESP of -10.72%.

Zacks Rank:  MarketAxess currently has a Zacks Rank #5 (Strong Sell).

Stocks to Consider

Some stocks worth considering with the apt combination of elements to surpass estimates this reporting cycle are as follows:

Cboe Global Markets, Inc. (CBOE - Free Report) has an Earnings ESP of +3.77% and a Zack Rank #2, presently.  You can see  the complete list of today’s Zacks #1 Rank stocks here.

Tradeweb Markets Inc. (TW - Free Report)    has an Earnings ESP of +2.63% and a Zacks Rank #3, presently.

Intercontinental Exchange Inc. (ICE - Free Report) has an Earnings ESP of +2.99% and a Zacks Rank of #3, presently.