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

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Nasdaq, Inc. NDAQ is slated to report first-quarter 2020 results on Apr 22, before market open. In the last reported quarter, the company’s earnings surpassed the Zacks Consensus Estimate by 1.57%, led by higher revenues.

Let’s see how things have shaped up for the upcoming announcement.

Nasdaq’s first-quarter results are likely to reflect expansion of index and analytics businesses, higher listing business and lower interest expenses.

Nasdaq’s first-quarter results are also expected to reflect the contribution of new eVestment products, Research Management and Market Lens and Quandl acquisition.

Non-trading revenues are likely to have benefited from improved performance of Market Technology, continued solid growth of Index and Investment Data & Analytics businesses.

Market Technology and Information Services businesses offer the biggest growth opportunities. Organic growth, Cinnober acquisition, higher software delivery and higher index and growing listing business are likely to have driven revenues. The Zacks Consensus Estimate for Marketing Information Service revenues is pegged at $199 million, indicating an increase of 3.1% from the year-ago reported figure.

Higher listings are expected to have aided revenues. In the first quarter, there were 4,185 listed companies on Nasdaq compared with 4,077 in the year-ago period. Total listings grew 2.6% year over year to 4,185.  The Zacks Consensus Estimate for listing services revenues is pegged at $74 million, indicating 4.2% increase from the year-ago period reported figure.

Interest expenses are likely to have decreased due to lower outstanding debt obligations as well as refinancing of the 2020 Notes with 2029 Notes at a lower interest rate.

Sustained share buyback is likely to have provided additional boost to the bottom line.

The Zacks Consensus Estimate for earnings is pegged at $1.43, indicating 17.2% increase from the year-ago period reported figure.

Earnings Surprise History

The company boasts an attractive earnings surprise history, having surpassed estimates in each of the trailing four quarters, the positive surprise being 3.33%, on average. This is depicted in the chart below:

Nasdaq, Inc. Price and EPS Surprise

What Our Quantitative Model States   

Our proven model predicts an earnings beat for Nasdaq this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.

Earnings ESP: Nasdaq has an Earnings ESP of +1.15%. This is because the Most Accurate Estimate of $1.45 is higher than the Zacks Consensus Estimate of $1.43. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Nasdaq carries a Zacks Rank #3.

Other Stocks to Consider

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

Banner Corporation (BANR - Free Report) is set to report first-quarter earnings on Apr 27. The stock has an Earnings ESP of +10.12% and a Zacks Rank of 3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Flagstar Bancorp, Inc. (FBC - Free Report) is set to report first-quarter earnings on Apr 28. The stock has an Earnings ESP of +0.26% and a Zacks Rank #3.

OceanFirst Financial Corp. (OCFC - Free Report) is set to report first-quarter earnings on Apr 23. The stock has an Earnings ESP of +6.94% and a Zacks Rank of 3.

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