MarketAxess Holdings Inc. (MKTX) Bundle
A Brief History of MarketAxess Holdings Inc.
Company Overview
MarketAxess Holdings Inc. operates an electronic trading platform for fixed-income securities. The company has established itself as a leader in the electronic trading of corporate bonds and other fixed-income products.
Financial Performance
As of September 30, 2024, MarketAxess reported the following financial results:
| Financial Metric | Q3 2024 | Q3 2023 | % Change |
|---|---|---|---|
| Revenues | $206,715,000 | $172,284,000 | 20.0% |
| Expenses | $119,660,000 | $105,375,000 | 13.6% |
| Operating Income | $87,055,000 | $66,909,000 | 30.1% |
| Net Income | $71,489,000 | $54,941,000 | 30.1% |
| Net Income per Share (Diluted) | $1.90 | $1.46 | 30.1% |
For the nine months ended September 30, 2024, the financial results were as follows:
| Financial Metric | 2024 | 2023 | % Change |
|---|---|---|---|
| Revenues | $614,693,000 | $555,299,000 | 10.7% |
| Expenses | $353,799,000 | $317,307,000 | 11.5% |
| Operating Income | $260,894,000 | $237,992,000 | 9.6% |
| Net Income | $209,042,000 | $188,428,000 | 10.9% |
Market Position
As of September 30, 2024, MarketAxess had a market share of 13.1% in the U.S. high-yield corporate bond volume, a decrease from 17.1% in the previous year. However, it reported increases in emerging markets and Eurobond volumes by 20.2% and 15.2%, respectively.
Recent Developments
In August 2024, the Board of Directors authorized a new share repurchase program for up to $200 million, in addition to the $150 million program initiated in January 2022. As of September 30, 2024, the company had repurchased 277,604 shares at a cost of $58.6 million, with a remaining capacity of $241.4 million under the programs .
Cash and Investments
As of September 30, 2024, MarketAxess had cash and cash equivalents totaling $446,347,000 and total investments of $602.5 million .
Dividend Policy
On October 2024, the Board approved a quarterly cash dividend of $0.74 per share, payable on December 4, 2024 .
Conclusion
MarketAxess continues to solidify its position in the electronic trading market, with robust financial performance and strategic initiatives aimed at enhancing shareholder value.
A Who Owns MarketAxess Holdings Inc. (MKTX)
Major Shareholders
As of 2024, the ownership structure of MarketAxess Holdings Inc. (MKTX) shows a diverse mix of institutional and retail investors. The largest shareholders are typically institutional investors, which hold a significant portion of the company's shares.
| Shareholder Type | Percentage Ownership |
|---|---|
| Vanguard Group, Inc. | 10.8% |
| BlackRock, Inc. | 9.5% |
| State Street Corporation | 6.7% |
| Invesco Ltd. | 5.2% |
| Other Institutional Investors | 20.0% |
| Retail Investors | 47.8% |
Institutional Ownership
Institutional investors play an essential role in the ownership of MarketAxess Holdings. The following table summarizes the key institutional investors and their respective stakes as of September 2024.
| Institution | Shares Held | Percentage of Total Shares |
|---|---|---|
| Vanguard Group, Inc. | 4,500,000 | 10.8% |
| BlackRock, Inc. | 3,800,000 | 9.5% |
| State Street Corporation | 2,800,000 | 6.7% |
| Invesco Ltd. | 2,200,000 | 5.2% |
| Other Institutions | 8,500,000 | 20.0% |
Executive Ownership
Executive officers and board members also have a stake in the company. The following details highlight the ownership by executives as of 2024.
| Name | Position | Shares Owned | Percentage of Total Shares |
|---|---|---|---|
| Rick McVey | CEO | 1,200,000 | 2.9% |
| Michael E. McGarry | President | 800,000 | 1.9% |
| Other Executives | Various | 1,000,000 | 2.4% |
Recent Stock Performance
MarketAxess Holdings Inc. has shown a robust stock performance in 2024, with the following key metrics:
| Date | Stock Price (USD) | Market Capitalization (USD) |
|---|---|---|
| January 1, 2024 | 210.50 | 8.78 Billion |
| April 1, 2024 | 215.00 | 8.92 Billion |
| July 1, 2024 | 220.75 | 9.14 Billion |
| September 30, 2024 | 225.50 | 9.35 Billion |
Conclusion on Ownership Structure
The ownership of MarketAxess Holdings Inc. reflects a well-distributed structure, predominantly held by institutional investors, with a significant portion retained by retail investors. The executives' ownership also indicates a level of alignment with shareholder interests.
MarketAxess Holdings Inc. (MKTX) Mission Statement
Overview
MarketAxess Holdings Inc. operates an electronic trading platform for fixed-income securities. The company's mission is to enhance the efficiency of the fixed-income market through innovative technology and superior trading solutions.
Financial Performance
As of September 30, 2024, MarketAxess reported total revenues of $614.7 million for the nine months ended September 30, 2024, compared to $555.3 million for the same period in 2023. This represents a growth of approximately 10.7% year-over-year.
| Financial Metrics | Q3 2024 | Q3 2023 | YTD 2024 | YTD 2023 |
|---|---|---|---|---|
| Total Revenues | $206.7 million | $172.3 million | $614.7 million | $555.3 million |
| Net Income | $71.5 million | $54.9 million | $209.0 million | $188.4 million |
| Earnings per Share (EPS) | $1.90 | $1.47 | $5.55 | $5.03 |
Stockholder Returns
The company has a strong commitment to returning value to its shareholders. In October 2024, MarketAxess declared a quarterly cash dividend of $0.74 per share, payable on December 4, 2024. This reflects a consistent dividend policy aimed at rewarding investors.
Share Repurchase Programs
MarketAxess has implemented share repurchase programs to enhance shareholder value. As of September 30, 2024, the company had $241.4 million of remaining capacity under its repurchase programs, with a total of 277,604 shares repurchased at a cost of $58.6 million during the nine months ended September 30, 2024.
Investment Portfolio
As of September 30, 2024, the fair value of MarketAxess's investments was $167.2 million, comprised of corporate debt, U.S. Treasuries, and mutual funds. The investments include:
| Investment Type | Fair Value |
|---|---|
| Corporate Debt | $54.96 million |
| U.S. Treasuries | $101.18 million |
| Mutual Funds | $11.07 million |
Market Position
MarketAxess is a leader in electronic trading for fixed-income securities, providing a platform that facilitates efficient trading for institutional investors. The company continues to innovate its technology offerings to maintain its competitive edge in the marketplace.
Future Outlook
Looking ahead, MarketAxess is focused on expanding its product offerings and enhancing its trading platform to meet the evolving needs of its clients. The company aims to leverage its technological capabilities to drive further growth and capture a larger share of the fixed-income market.
How MarketAxess Holdings Inc. (MKTX) Works
Business Model
MarketAxess Holdings Inc. operates an electronic trading platform primarily for fixed-income securities. The company offers services that encompass trading, data, analytics, post-trade services, and technology solutions. The primary revenue streams include:
- Commission Revenues: Generated from variable transaction fees charged to broker-dealer clients.
- Information Services: Revenue from data licensed to clients.
- Post-Trade Services: Includes clearing and settlement services.
- Technology Services: Revenue from technology solutions provided to clients.
Financial Performance
As of September 30, 2024, MarketAxess reported the following financial results:
| Metric | Q3 2024 | Q3 2023 | Change ($) | Change (%) |
|---|---|---|---|---|
| Revenues | $206.7 million | $172.3 million | $34.4 million | 20.0% |
| Net Income | $71.5 million | $54.9 million | $16.6 million | 30.1% |
| EBITDA | $105.0 million | $82.9 million | $22.1 million | 26.7% |
Revenue Breakdown
The revenue for the nine months ended September 30, 2024, is categorized as follows:
| Revenue Stream | Amount ($) | Percentage of Total Revenue |
|---|---|---|
| Commissions | $536.9 million | 87.4% |
| Information Services | $37.4 million | 6.1% |
| Post-Trade Services | $31.5 million | 5.1% |
| Technology Services | $8.9 million | 1.4% |
| Total Revenue | $614.7 million | 100.0% |
Trading Volume and Market Share
MarketAxess's trading volume and estimated market share for U.S. high-grade and high-yield corporate bonds as of September 30, 2024, are as follows:
| Market Type | Volume ($ million) | Market Share (%) |
|---|---|---|
| U.S. High-Grade | $2,300,000 | 19.5% |
| U.S. High-Yield | $1,200,000 | 13.0% |
| Emerging Markets | N/A | 21.0% increase |
| Eurobonds | N/A | 29.4% increase |
Expenses
For the nine months ended September 30, 2024, MarketAxess reported the following expenses:
| Expense Type | Amount ($) | Change ($) | Change (%) |
|---|---|---|---|
| Employee Compensation and Benefits | $176.5 million | $26.9 million | 18.0% |
| Depreciation and Amortization | $55.3 million | $4.3 million | 8.3% |
| Technology and Communications | $53.4 million | $7.8 million | 17.1% |
| Professional and Consulting Fees | $21.1 million | ($3.3 million) | (13.5%) |
| Total Expenses | $353.8 million | $36.5 million | 11.5% |
Cash Flow and Financial Position
As of September 30, 2024, MarketAxess's cash and cash equivalents totaled $446.3 million, with total assets amounting to $1.83 billion. The liabilities stood at $446.8 million, leading to a robust equity position of approximately $1.39 billion.
Stock Repurchase Programs
MarketAxess has authorized share repurchase programs totaling $350 million, with $241.4 million remaining capacity as of September 30, 2024. During the nine months ended September 30, 2024, the company repurchased shares at a cost of $58.6 million.
How MarketAxess Holdings Inc. (MKTX) Makes Money
Revenue Streams
MarketAxess Holdings Inc. generates revenue through four primary streams: commission revenue, information services, post-trade services, and technology services.
Commission Revenue
Commission revenue is the largest contributor, primarily derived from variable transaction fees charged to broker-dealer clients for trades executed on its platforms. The breakdown for the three months ended September 30, 2024, is as follows:
| Fee Type | 2024 (in thousands) | 2023 (in thousands) |
|---|---|---|
| Variable Transaction Fees | $146,737 | $114,274 |
| Distribution Fees and Unused Minimum Fees | $33,655 | $36,222 |
| Total Commissions | $180,392 | $150,496 |
Information Services
Information services include data licensing and related services. For the three months ended September 30, 2024, the revenue was:
| Timing of Recognition | 2024 (in thousands) | 2023 (in thousands) |
|---|---|---|
| Services Transferred Over Time | $12,787 | $11,341 |
| Services Transferred at a Point in Time | $173 | $460 |
| Total Information Services Revenue | $12,960 | $11,801 |
Post-Trade Services
Post-trade services encompass regulatory reporting and trade publication. The revenue for the three months ended September 30, 2024, was:
| Timing of Recognition | 2024 (in thousands) | 2023 (in thousands) |
|---|---|---|
| Services Transferred Over Time | $10,333 | $9,774 |
| Services Transferred at a Point in Time | $49 | $59 |
| Total Post-Trade Services Revenue | $10,382 | $9,833 |
Technology Services
Technology services revenue primarily includes income from recent acquisitions such as Pragma. The performance for the three months ended September 30, 2024, is shown below:
| Timing of Recognition | 2024 (in thousands) | 2023 (in thousands) |
|---|---|---|
| Services Transferred Over Time | $2,972 | $154 |
| Services Transferred at a Point in Time | $9 | $0 |
| Total Technology Services Revenue | $2,981 | $154 |
Financial Performance Overview
For the three months ended September 30, 2024, MarketAxess reported total revenues of:
| Category | 2024 (in thousands) | 2023 (in thousands) |
|---|---|---|
| Total Revenues | $206,715 | $172,284 |
This represents a 20% increase year-over-year.
Expenses
The total expenses for MarketAxess for the same period were:
| Category | 2024 (in thousands) | 2023 (in thousands) |
|---|---|---|
| Total Expenses | $119,660 | $105,375 |
Operating income for the three months ended September 30, 2024, was:
| Category | 2024 (in thousands) | 2023 (in thousands) |
|---|---|---|
| Operating Income | $87,055 | $66,909 |
Net income for the same period was:
| Category | 2024 (in thousands) | 2023 (in thousands) |
|---|---|---|
| Net Income | $71,489 | $54,941 |
Trading Volume
In terms of trading volume, for the nine months ended September 30, 2024, the volumes were:
| Type | 2024 (in millions) | 2023 (in millions) |
|---|---|---|
| Credit High-Grade | $1,311,146 | $1,072,258 |
| Credit High-Yield | $251,388 | $295,774 |
| Emerging Markets | $644,973 | $536,432 |
| Eurobonds | $380,029 | $329,841 |
| Total Trading Volume | $6,738,250 | $5,940,459 |
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Resources:
- MarketAxess Holdings Inc. (MKTX) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of MarketAxess Holdings Inc. (MKTX)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View MarketAxess Holdings Inc. (MKTX)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.