Nasdaq OMX Group Inc.
) fourth-quarter 2013 operating earnings per share of 69 cents
modestly surpassed the Zacks Consensus Estimate of 66 cents as
well as the prior-year quarter number of 64 cents.
Nasdaq's GAAP net income was $141 million or 81 cents per
share, higher than $85 million or 66 cents per share recorded in
the year-ago quarter. Excluding extraordinary items, operating
net income was $119 million compared with $108 million in the
Total net exchange revenues increased 23.2% year over year to
$520 million, also exceeding the Zacks Consensus Estimate of $517
million.On a constant currency basis and excluding acquisitions,
revenues rose 5% in the reported quarter.
The improvement was primarily attributable to growth in the
non-trading business segments. Non-transaction based revenues
were accounted for 73% of total net revenue and grew 27% from the
prior-year quarter. Theacquisitions of Thomson Reuters' IR, PR
and Multimedia businesses and the eSpeed electronic fixed income
platform were also accretive to the financials.
net exchange revenues for the quarter upped 9.1% from the
year-ago period to $204 million, based on higher revenues and
lower cost of revenues.
revenues were a million higher $58 million, while
rose 10.1% to $109 million. Additionally,
revenues surged 88.6% to $149 million in the reported
During the reported quarter, Nasdaq's order intakes surged to
$138 million from $98 million in the year-ago quarter.
Consequently, total order value (the value of orders signed that
have not been recognized as revenue) improved to $655 million
from $559 million in the prior-year quarter. New listings totaled
94 against 55 in the year-ago quarter.
Meanwhile, on a non-GAAP basis, core operating expenses stood
at $313 million, up 32.6% from the year-ago period. Consequently,
total operating income, on a non-GAAP basis, jumped 11.3% year
over year to $207 million. However, operating margin contracted
400 basis points year over year to 40%.
Highlights of Full-Year 2013
For full-year 2013, Nasdaq reported operating earnings per
share of $2.60, which exceeded the Zacks Consensus Estimate of
$2.57 but lagged $2.50 per share recorded in 2012. Operating net
income improved 3% over 2012 to $445 million.
Including extraordinary items, GAAP net income came in at $385
million or $2.25 per share, lower than $352 million or $2.04 per
share recorded in 2012.
Total net exchange operating revenues soared 13.2% year over
year to $1.9 billion and were in line with the Zacks Consensus
Estimate. Core operating expenses increased 20.8% year over year
to $1.12 billion on a non-GAAP basis. Hence, operating margin
fell to 41% from 44% in 2012.
As of Dec 31, 2013, Nasdaq had cash and cash equivalents of
$509 million, down from $582 million at the end of 2012. Debt
obligations of Nasdaq stood at $2.59 billion, up from $1.84
billion at 2012-end.
However, Nasdaq paid $98 million of debt in the reported
quarter. Total assets of Nasdaq increased to $12.58 billion from
$9.13 billion at 2012-end, while total equity improved to $6.18
billion from $5.21 billion at 2012-end.
Management aims to reduce debt-to-EBITDA ratio to mid-2x range
by mid-2014. Core operating expense is projected to be within
$1.215-1.235 billion. Additionally, the company expects
approximately $35-50 million of incremental expenses from new
initiative or GIFT spending in 2014.
Including these charges, total expenses are projected in the
range of $1.250-1.285 billion. Tax rate is anticipated in the
band of 33-35% in 2014.
Concurrently, the board of directors of Nasdaq declared a cash
dividend of 13 cents per share, which is payable on Mar 28, 2014
to shareholders of record as on Mar 14.
On Dec 27, 2013, Nasdaq paid a cash dividend of 13 cents per
share to shareholders of record as on Dec 13.
Other Stocks to Consider
Nasdaq presently carries a Zacks Rank #3 (Hold). Better-ranked
financial stocks include
CME Group Inc.
American Express Co.
), each carrying a Zacks Rank #2 (Buy).
AMER EXPRESS CO (AXP): Free Stock Analysis
CME GROUP INC (CME): Free Stock Analysis
MOODYS CORP (MCO): Free Stock Analysis Report
NASDAQ OMX GRP (NDAQ): Free Stock Analysis
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