MarketAxess Holdings: Strong Credit Volume Growth and Market Share Performance Justify Buy Rating

Analyst Michael Cyprys of Morgan Stanley maintained a Buy rating on Marketaxess Holdings (MKTX – Research Report), retaining the price target of $283.00.

Michael Cyprys has given his Buy rating due to a combination of factors including MarketAxess Holdings’ strong credit volume growth and market share performance. The company reported a significant year-over-year increase in credit volumes for May, which were up by 22%, and its investment-grade credit market share rose by 70 basis points compared to the previous year. This positive momentum in credit volumes and market share is seen as a supportive factor for the stock, despite its year-to-date underperformance relative to peers.
Additionally, MarketAxess’s total average daily volume (ADV) for the quarter to date through May is tracking above both Morgan Stanley’s estimates and consensus expectations, driven by robust performance in rates and credit volumes. Although there was a decline in the fee per million for total credit compared to the previous year, the stability in monthly fee capture and the overall strength in various segments such as emerging markets and Eurobonds contribute to the positive outlook. These elements combined justify the Buy rating assigned by Cyprys.

Based on the recent corporate insider activity of 61 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of MKTX in relation to earlier this year.