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Nasdaq (NDAQ) to Report Q1 Earnings: What's in the Cards?

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Nasdaq, Inc. (NDAQ - Free Report) is slated to report first-quarter 2019 results on Apr 24, before market open. The company delivered positive earnings surprise in three of the last four quarters.

Let’s see how things are shaping up for this announcement.

Expansion of index and analytics businesses, growth in exchange data products across U.S. and Nordic equities, solid options and fixed income businesses are likely to aid Nasdaq’s first-quarter results.

Strategic buyouts are also expected to boost the company’s operational performance.

The company reported mixed volumes for the first quarter. While U.S. equity options volume decreased 14.3% year over year to 406 million contracts, European options and futures volume increased 0.4% year over year to 22.4 million contracts.

Though revenues per contract for U.S. equity options improved 7.1% year over year to 15 cents, the same for European options and futures deceased 10.6% to 42 cents.

Higher listings are expected to boost listing revenues in the first quarter. In the first quarter, 3,689 companies were listed on Nasdaq compared with 3,579 in the year-ago period. Total listings grew 3.1% year over year to 4,077. The Zacks Consensus Estimate for listing services revenues is pegged at $75 million, indicating an increase of 7.1% from the year-ago reported figure.

Improved market technology and higher listing and information revenues are likely to drive non-transaction revenues. Market Technology and Information Services businesses offer the biggest growth opportunities per the company’s developmental strategies. The Zacks Consensus Estimate for Marketing Information Service revenues is pegged at $193 million, indicating an increase of 10.9% from the year-ago reported figure.

Interest expenses are expected to be on the higher side due to a high debt level. Operating expenses are expected to rise owing to organic growth initiatives. These are expected to put pressure on margin.

The Zacks Consensus Estimate for earnings is pegged at $1.17, indicating 5.7% decrease from the year-ago period actual figure.

What Our Quantitative Model Says

Our proven model does not conclusively show that Nasdaq is likely to beat estimates this reporting cycle. This is because the stock does not have the right combination of a positive Earnings ESP and a favorable Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold).

Earnings ESP: Nasdaq has an Earnings ESP of -0.98. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

Nasdaq, Inc. Price and EPS Surprise

Zacks Rank: Nasdaq carries a Zacks Rank #3, which increases the predictive power of ESP. However, we need to have a positive ESP to be confident about an earnings surprise.

We caution against Sell-rated stocks (#4 or 5) going into an earnings announcement, especially when the company is seeing negative estimate revisions.

Stocks to Consider

Here are stocks from the finance sector with the perfect combination of elements to surpass estimates in their upcoming releases.

Aflac Incorporated (AFL - Free Report) is set to report first-quarter earnings on Apr 25. The stock has an Earnings ESP of +0.57% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Cincinnati Financial Corporation (CINF - Free Report) is set to report first-quarter earnings on Apr 25. The stock has an Earnings ESP of +4.26% and a Zacks Rank of 2.

Affiliated Managers Group, Inc. (AMG - Free Report) has an Earnings ESP of +0.46% and a Zacks Rank of 2. The company will announce first-quarter earnings on Apr 29.

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