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Virtu Financial (VIRT), ClearingBid Bring Retail Access to IPOs

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Virtu Financial, Inc. (VIRT - Free Report) recently announced a strategic partnership with ClearingBid, Inc., aiming to enable broader access to IPO offerings for retail investors and brokers. Under this collaboration, ClearingBid’s IPO network will use Virtu ITG Net’s scaled connectivity platform. This will enable a broader set of brokers and financial institutions to participate in placing orders for IPO shares. IPO investing has always been reserved for an elite few but with this collaboration, better pricing and transparency can be achieved, benefiting every party involved.

This move bodes well for Virtu Financial as its customers will get access to IPOs, similar to placing secondary market limit orders. Moreover, this enhances its offerings to customers by providing better transparency and other tools improving the trading process.

This augurs well for VIRT’s Execution Services segment, as it aims to diversify its revenue base. With this partnership, the segment is likely to contribute more to the company’s top line in the future. Workflow Technology contributed 20.3% to total execution services revenues in 2023.

ClearingBid aims to leverage Virtu ITG Net to enhance the non-transparent and inefficient IPO process, benefiting the issuers as well as underwriters. This move comes at an opportune time when the demand for retail participation seems on an uprise. VIRT’s global FIX connectivity, when combined with ClearingBid’s price discovery, will enable issuers to witness better price discovery with higher-than-ever investor participation.

This collaboration highlights Virtu Financial’s focus on developing cutting-edge technologies to deliver transparent trading solutions to clients and liquidity in markets. This should further solidify its position as a financial services provider by enhancing its core value proposition which is its technology platform.

Zacks Rank and Price Performance

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

Shares of Virtu Financial have gained 7.1% in the past month against the industry’s 2.2% growth.

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Stocks to Consider

Some better-ranked stocks in the Financial – Miscellaneous Services space include Axos Financial, Inc. (AX - Free Report) , Primis Financial Corp. (FRST - Free Report) and Rithm Capital Corp. (RITM - Free Report) . Each of these companies presently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Axos Financial’s earnings surpassed estimates in each of the last four quarters, the average surprise being 12.3%. The Zacks Consensus Estimate for AX’s fiscal 2024 earnings and revenues indicates a rise of 42.4% and 22.4%, respectively, from the year-ago actuals.

The bottom line of Primis Financial beat estimates in two of the trailing four quarters, missing twice, the average beat being 3.7%. The Zacks Consensus Estimate for FRST’s 2024 earnings and revenues indicates a rise of 68.8% and 2.7%, respectively, from the year-ago tally. The consensus mark for FRST’s 2024 earnings has moved 14.6% north in the past seven days.

Rithm Capital’s earnings outpaced estimates in each of the trailing four quarters, the average surprise being 52%. The Zacks Consensus Estimate for RITM’s 2024 revenues indicates a rise of 33.2% from the year-ago actuals. The consensus mark for RITM’s 2024 earnings has moved 1.8% north in the past seven days.

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