MarketAxess Holdings Inc.
) reported its fourth-quarter 2013 operating net income of 41
cents per share, in line with the Zacks Consensus Estimate.
However, the results increased 7.9% from the year-ago quarter
number of 38 cents that excluded the effect of favorable tax
adjustment of 18 cents.
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Bottom-line growth was primarily driven by growing market share
of the company as well as record volumes across its core
MarketAxess' total revenue grossed $60.4 million in the reported
quarter and missed the Zacks Consensus Estimate of $61 million.
The figure, however, outpaced the prior-year quarter number by
24.4%. Top-line improvement stemmed from higher commission
revenues (up 14.1% year over year) as well as higher information
and post-trade service revenues.
The significant surge in revenues from information and post-trade
services was due to Xtrakter Limited that generated $5.6 million
of revenues during the reported quarter.
Total expense at MarketAxess rose 35.1% to $35.6 million during
the reported quarter. The increase was attributable to operating
expenses associated with the Xtrakter as well as higher variable
incentive compensation, salaries, and depreciation and
The company reported pretax income of $24.8 million for the third
quarter, up 11.8% year over year.
Pre-tax margin contracted 470 basis points year over year to 41%.
Total trading volume of MarketAxess increased 14.9% from the
prior-year quarter to $171.3 billion.
Full-Year 2013 Highlights
MarketAxess reported operating net earnings of $1.81 per share
for full-year 2013 that increased 24% from the 2012 comparable
Total revenue grossed $238.7 million, increasing 25.1% over 2012.
Total expense stood at $131.5 million, escalating 29.5% from the
MarketAxess exited the fourth quarter of 2013 with total assets
of $351.6 million, increasing 25.6% from the 2012 year-end level.
Total cash and cash equivalents was $132.7 million at the end of
2013, up 2.9% from the 2012 year-end level.
At the end of the reported quarter, MarketAxess had total
stockholder's equity of $310.4 million, up 27.9% from the end of
The board of directors of MarketAxess approved a quarterly cash
dividend of 16 cents per share which will be paid on Feb 27, 2014
to the stockholders of record as on Feb 13, 2014. This quarterly
dividend represents 23.1% increase from the prior one.
Share Repurchase Update
The board of directors at MarketAxess approved $35 million of
share repurchase program common stock in early Jan 2014.
MarketAxess expects full-year 2014 total expense to lie in the
range of $150-$157 million and the capital spending for the same
time period should range within $17 million to $20 million. The
full-year effective tax rate guidance range was also updated to
MarketAxess presently carries a Zacks Rank #3 (Hold). Other
better-ranked stocks in the financial sector that are worth
CME Group Inc.
American Express Company
). All these stocks carry a Zacks Rank #2 (Buy).