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Here's Why You Should Hold Nasdaq Stock in Your Portfolio

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Nasdaq (NDAQ - Free Report) remains well poised for growth banking on diverse global offerings, strategic acquisitions, solid capital position and prudent capital deployment.

Estimates for Nasdaq have been revised upward over the past 60 days, reflecting analysts’ confidence in the stock. The Zacks Consensus Estimate for 2019 earnings per share has moved 0.4% up in the said time frame. The company also has a decent history of beating estimates in three of the last four quarters with the average beat being 1.92%.

Nasdaq’s return on equity — a measure of profitability — is 14.9% in the trailing 12-month period, better than the industry average of 10.9%. This reflects the company’s prudent usage of its shareholders’ funds.

Shares of this Zacks Rank #3 (Hold) company have rallied 21.7% year to date, outperforming the industry’s increase of 18.4%.



Nasdaq continues to expect solid growth from its index and analytics businesses, followed by moderate growth in its exchange data products. Nasdaq remain focused on Market Technology and Information Services businesses that offer the biggest growth opportunities, given the company’s developmental strategies. The company also remains focused on accelerating its non-transaction revenue base.

Technological expansion with SMARTS surveillance in non-financial markets reflects the company’s focus on capitalizing on emerging opportunities in the cryptocurrency markets.

These apart, strategic acquisitions have been helping Nasdaq expand its technology offering, strengthen Corporate Solutions business and improve market surveillance techniques.

Nasdaq boasts a healthy balance sheet and cash position attributable to its diverse business model, aiding in efficient capital deployment to de-leverage, makes investments in organic growth strategies strategic acquisitions and enhance shareholders value. It has hiked dividend at a three-year CAGR of 13%. The company also has $282 million remaining under its share repurchase authorization. Nasdaq’s dividend yield of 1.9% betters the industry average of 1.4%. These make the stock an attractive pick for yield-seeking investors.

The Zacks Consensus Estimate for 2019 and 2020 earnings per share is pegged at $4.92 and $5.37, indicating year-over-year increase of 1.6% and 9.3% respectively. The expected long-term earnings growth rate is pegged at 6.9%.

Stocks to Consider

Some better-ranked finance stocks include Cardtronics , Fiserv and Fleetcor Technologies . While Cardtronics and Fiserv sport a Zacks Rank #1 (Strong Buy), Fleetcor carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Cardtronics offers automated consumer financial services through its network of automated teller machines and multi-function financial services kiosks and provides cash dispensing and balance enquiries. The company delivered an average four-quarter positive surprise of 44.43%.

Fiserv provides financial services technology. The company came up with an average four-quarter positive surprise of 0.59%.

Fleetcor Technologies provides commercial payment solutions and fuel payments solution to businesses and government entities. It pulled off a four-quarter average beat of 2.48%.

5 Stocks Set to Double

Zacks experts released their picks to gain +100% or more in 2020. One is a famous cutting-edge food company that is “hiding in plain sight.” Swamped with competitors and ignored by Wall Street, its stock price floundered. Now, suddenly, it acquired a company that gives it an advantage none of its peers have.

Today, see all 5 stocks with extreme growth potential >>
 


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