MarketAxess Holdings Inc. (MKTX Quick QuoteMKTX - Free Report) reported first-quarter 2022 earnings per share of $1.73, which beat the Zacks Consensus Estimate by 1.8%, driven by revenues and trading volumes. However, the bottom line declined from $2.11 per share a year ago.

Total revenues were $186 million for the quarter under review, reflecting a decrease of 4.6% year over year. The figure matched the Zacks Consensus Estimate.

Operational Update

Emerging markets volume decreased 7% year over year while emerging markets ADV was up 5%. For the first quarter, the company announced active total client firms of 1,913, while international client firms totaled 975.
Commission revenues of $166.1 million declined 5.5% from $175.8 million.

Nevertheless, all other revenues comprising information services, post-trade services and other revenues climbed 2% year over year to $19.7 million.

For the first quarter, the total credit category’s trading volumes decreased 3% year over year to $12 billion. Rates commission revenue increased 49% year over year to $6.3 billion, driven by record U.S. Treasury ADV.

Total expenses of $98 million increased 7% year over year, primarily due to a rise in costs related to acquired intangible amortization and investments to enhance the trading system and data products.

Operating income increased 21% year over year to $88 million. Operating margin of 47% expanded 340 basis points year over year.

Cash Flow

Cash flows from operations are $23.73 million, up 2.5% year over year.
During the quarter, the company generated a free cash flow of $33.9 million, which declined from $52.3 million in the last-year comparable period.

Shareholder Value Boost

MarketAxess’ board of directors announced a quarterly cash dividend of 70 cents per share, which will be paid out on May 18, 2022, to shareholders of record as of May 4.

In the first quarter, the company bought back 101,514 shares worth $38.8 million.

Balance Sheet (as of Mar 31, 2022)

The company exited the first quarter with $400.4 million in cash, cash equivalents and investments.

Total assets of $1.7 billion declined sequentially from $1.53 billion. Total stockholders’ equity was $1 billion at the first quarter-end, declining 1.7% from the figure as of Dec 31, 2021.

Guidance

MKTX reconfirms 2022 effective tax rate guidance range of 24% to 26% for 2022.

Zacks Rank & Companies With Favorable Combination

Just like MKTX — currently carrying a Zacks Rank #3 (Hold) — pulled off an earnings beat for the first quarter, here are some other companies from the Finance space that you may also want to consider, as these too have the right combination of elements to post an earnings beat this time around:

ProAssurance Corporation (PRA Quick QuotePRA - Free Report) has an Earnings ESP  of +27.54% and a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for ProAssurance’s bottom line for the to-be-reported quarter indicates an improvement of 325% from the prior-year period. PRA witnessed one upward estimate revision in the past 30 days.

Centerspace (CSR Quick QuoteCSR - Free Report) has an Earnings ESP of +2.51% and a Zacks Rank #2.
The Zacks Consensus Estimate for Centerspace’s earnings per share for the to-be-reported quarter is pegged at $1.06, implying an improvement of 11.6% from the year-ago figure of 95 cents. CSR witnessed one upward estimate revision in the past 30 days.

SouthState Corporation (SSB Quick QuoteSSB - Free Report) has an Earnings ESP of +1.97% and a Zacks Rank #2.

The Zacks Consensus Estimate for SouthState’s bottom line for the to-be-reported quarter has improved 4.8% in the past 30 days. SSB beat earnings estimates in each of the last four quarters, the average surprise being 24.74%.