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5/27/2011 7:34:52 PM
NYSE Euronext (NYSE:NYX), which competes with Nasdaq (NASDAQ:NDAQ) and Chicago Mercantile Exchange ( CME ), is the world's leading stock exchange in cash trading both in terms of volume and value. Recently, NYSE Euronext and Deutsche Boerse AG of Germany announced a merger that will create the world's largest financial exchange. Nasdaq teamed up with Intercontinental Exchange to counter-bid for NYSE Euronext but NYSE quickly rejected the bid.
The Two Most Important Business Divisions for NYSE Euronext
1) Cash Trading & Listings - 49% of the company's stock value
Cash trading and listings represent the most valuable division for NYSE Euronext. The NYSE's main business is executing trades across its exchanges that include the New York Stock Exchange, Euronext, NYSE Amex, NYSE Arca, NYSE Alternext and NYSE Arca Europe. The NYSE has been the most active exchange in the U.S. with the most number of companies listed.
2) Derivatives Trading - 42% of the company's stock value
Derivatives trading is the second most important division for NYSE Euronext. It is comprised of NYSE Euronext's derivatives trading and clearing businesses and includes NYSE Liffe, NYSE Liffe Clearing, NYSE Liffe US, NYSE Amex Options, NYSE Arca Options, New York Portfolio Clearing and related derivatives market data. Revenue from derivatives trading and clearing consists of fixed per-contract fees for executing trades of derivatives contracts and clearing charges.
Our price estimate for NYSE Euronext stands at $35.51, implying a discount to market price.
See our full analysis of NYSE Euronext here