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Why Is Virtu Financial (VIRT) Down 3.9% Since Last Earnings Report?
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A month has gone by since the last earnings report for Virtu Financial (VIRT - Free Report) . Shares have lost about 3.9% in that time frame, outperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Virtu Financial due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Virtu Financial's Q4 Earnings and Revenues Beat Mark
Virtu Financial’s fourth-quarter 2021 earnings per share of $1.19 beat the Zacks Consensus Estimate by 43.4% owing to better revenues and higher trading volumes. The bottom line inched up 0.8% year over year. owing to higher trading volumes in U.S. equities.
The top line also beat the consensus mark by 28.9%.
Quarterly Operational Update
In the quarter under review, adjusted EBITDA dipped 4.5% to $328.4 million.
Total operating expenses increased 14.7% year over year to $478.6 million.
This is due to high employee compensation and payroll taxes, interest and dividend expense, depreciation and amortization, termination of office leases, transaction fees and expenses.
Segmental Update
Net trading income from the Market Making segment was up 9.1% year over year to $508.3 million in the quarter under review.
Net trading income from Execution Services came in at $5 million, down from the year-ago quarter’s figure of $39 million.
Dividend and Share Repurchase Update
Virtu Financial's board of directors declared a quarterly cash dividend of 24 cents per share to be paid out on Mar 15, 2022, to its shareholders of record as of Mar 1, 2022.
VIRT bought back shares worth $101.6 million under the share repurchase program.
Virtu Financial now has $737.2 million left under its share buyback authorization for future purchases of shares of Class A Common Stock and Virtu Financial Units.
Financial Update (as of Dec 31, 2021)
Virtu Financial had total assets worth $10.3 billion, up 3.6% from the level at 2020 end.
VIRT exited the December quarter with total equity of $1.8 billion, up 0.5% from the level on Dec 31, 2020.
Virtu Financial exited the fourth quarter with $1 billion of cash and cash equivalents, up 20.4% from the 2020-end level.
In the quarter under review, long-term borrowings slipped 2.1% to $1.6 billion from the level at 2020 end.
Full-Year Update
Total revenues of Virtu Financial decreased 13.2% year over year due to decreased volatility and volumes across global markets.
Net trading income was down 15.6% year over year while adjusted EBITDA was down 21% year over year. Earnings per share for 2021 came in at $3.91, down 24.2% year over year.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended upward during the past month.
The consensus estimate has shifted 35.43% due to these changes.
VGM Scores
Currently, Virtu Financial has a nice Growth Score of B, though it is lagging a bit on the Momentum Score front with a C. Charting a somewhat similar path, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Virtu Financial has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.
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Why Is Virtu Financial (VIRT) Down 3.9% Since Last Earnings Report?
A month has gone by since the last earnings report for Virtu Financial (VIRT - Free Report) . Shares have lost about 3.9% in that time frame, outperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Virtu Financial due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Virtu Financial's Q4 Earnings and Revenues Beat Mark
Virtu Financial’s fourth-quarter 2021 earnings per share of $1.19 beat the Zacks Consensus Estimate by 43.4% owing to better revenues and higher trading volumes. The bottom line inched up 0.8% year over year.
owing to higher trading volumes in U.S. equities.
The top line also beat the consensus mark by 28.9%.
Quarterly Operational Update
In the quarter under review, adjusted EBITDA dipped 4.5% to $328.4 million.
Total operating expenses increased 14.7% year over year to $478.6 million.
This is due to high employee compensation and payroll taxes, interest and dividend expense, depreciation and amortization, termination of office leases, transaction fees and expenses.
Segmental Update
Net trading income from the Market Making segment was up 9.1% year over year to $508.3 million in the quarter under review.
Net trading income from Execution Services came in at $5 million, down from the year-ago quarter’s figure of $39 million.
Dividend and Share Repurchase Update
Virtu Financial's board of directors declared a quarterly cash dividend of 24 cents per share to be paid out on Mar 15, 2022, to its shareholders of record as of Mar 1, 2022.
VIRT bought back shares worth $101.6 million under the share repurchase program.
Virtu Financial now has $737.2 million left under its share buyback authorization for future purchases of shares of Class A Common Stock and Virtu Financial Units.
Financial Update (as of Dec 31, 2021)
Virtu Financial had total assets worth $10.3 billion, up 3.6% from the level at 2020 end.
VIRT exited the December quarter with total equity of $1.8 billion, up 0.5% from the level on Dec 31, 2020.
Virtu Financial exited the fourth quarter with $1 billion of cash and cash equivalents, up 20.4% from the 2020-end level.
In the quarter under review, long-term borrowings slipped 2.1% to $1.6 billion from the level at 2020 end.
Full-Year Update
Total revenues of Virtu Financial decreased 13.2% year over year due to decreased volatility and volumes across global markets.
Net trading income was down 15.6% year over year while adjusted EBITDA was down 21% year over year. Earnings per share for 2021 came in at $3.91, down 24.2% year over year.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended upward during the past month.
The consensus estimate has shifted 35.43% due to these changes.
VGM Scores
Currently, Virtu Financial has a nice Growth Score of B, though it is lagging a bit on the Momentum Score front with a C. Charting a somewhat similar path, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Virtu Financial has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.