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Bgc Group, Inc. (BGC)
:BGC
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BGC Group
(NASDAQ:BGC)
69Neutral
Positive Factors
Energy Segment Growth
The energy segment of BGC Group is seen as having underappreciated secular growth qualities, contributing positively to the stock rating.
Exchange Growth
The bullish outlook for BGC Group's new FMX Futures Exchange is a key driver for the Buy rating.
Regulatory Environment
An eased regulatory backdrop is expected to significantly accelerate FMX Futures' growth, enhancing BGC Group's trading volumes.
Negative Factors
BGC Group (BGC) vs. S&P 500 (SPY)
Market Cap
$4.59B
Dividend Yield0.72%
Average Volume (3M)3.15M
Price to Earnings (P/E)38.4
Beta (1Y)0.88
Revenue Growth11.73%
EPS Growth242.82%
CountryUS
Employees3,895
SectorFinancial
Sector Strength81
IndustryCapital Markets
Share Statistics
EPS (TTM)0.25
Shares Outstanding373,430,570
10 Day Avg. Volume2,782,298
30 Day Avg. Volume3,153,019
Financial Highlights & Ratios
PEG Ratio0.16
Price to Book (P/B)N/A
Price to Sales (P/S)2.10
Price to Cash Flow (P/CF)4.50
P/FCF Ratio3.20
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$14.00Price Target Upside47.37% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
BGC Group Business Overview & Revenue Model
Company DescriptionBGC Group, Inc. operates as a financial brokerage and technology company in the United States and internationally. The company offers various brokerage products, such as fixed income, such as government bonds, corporate bonds, and other debt instruments, as well as related interest rate derivatives and credit derivatives; equities, energy and commodities, shipping, insurance, and futures and options. It also provides trade execution, connectivity solutions, brokerage services, clearing, trade compression and other post-trade services, information, and other back-office services to an assortment of financial and non-financial institutions. In addition, the company offers electronic and hybrid brokerage, other financial technology solutions, market data and related information services, and analytics related to financial instrument and markets. Its integrated platform is designed to provide flexibility to customers with regard to price discovery, execution and processing of transactions, and enables to use ots Voice, Hybrid, or in various markets, as well as fully electronic brokerage services in connection with transactions executed either OTC or through an exchange. It primarily serves banks, broker-dealers, investment banks, trading firms, hedge funds, governments, and corporations, as well as investment firms. BGC Group, Inc. was founded in 1945 and is headquartered in New York, New York.
How the Company Makes MoneyBGC Group makes money through a diversified revenue model that includes commissions from trade execution and brokerage services. The company earns fees by facilitating transactions in various financial instruments such as bonds, currencies, stocks, and derivatives. Additionally, BGC generates revenue from providing market data and analytics solutions, which are crucial for informed trading decisions. Significant partnerships with financial institutions and their extensive global network enhance their revenue streams. The company's earnings are further supported by its investments in technology and electronic trading platforms, which improve efficiency and client engagement in trading activities.
BGC Group Financial Statement Overview
Summary
BGC Group demonstrates strong revenue growth and profitability improvements. The company shows effective cost management, although operational inefficiencies are noted. The high debt-to-equity ratio highlights significant leverage risks despite improved return on equity. Cash flow management requires attention due to declining free cash flow, indicating potential liquidity challenges.Income Statement
BGC Group has demonstrated strong revenue growth, with a notable 13.3% increase from 2023 to 2024. Gross profit margins have been consistently healthy, and the firm has improved its net profit margin to 5.8% in 2024, up from 1.9% in 2023. This indicates effective cost management and profitability enhancements. However, the EBIT margin shows room for improvement, suggesting potential inefficiencies in operations.75
Positive
Balance Sheet
The company's debt-to-equity ratio is relatively high at 1.64, pointing to significant leverage that may pose risks in volatile markets. However, the return on equity has improved to 14.1% in 2024, indicating effective utilization of equity to generate profits. The equity ratio of 25% reflects moderate financial stability.70
Positive
Cash Flow
Free cash flow has decreased by 29.5% from 2023 to 2024, which could impact future investment capabilities. The operating cash flow to net income ratio remains robust at 2.48, indicating strong cash generation relative to net income. However, the decline in free cash flow growth rate suggests challenges in maintaining liquidity.68
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 2.21B | 1.95B | 1.80B | 2.02B | 2.06B | Gross Profit |
| 979.52M | 893.20M | 858.20M | 655.29M | 842.50M | EBIT |
| 334.80M | 274.96M | 81.36M | -148.99M | 70.00M | EBITDA |
| 345.65M | 202.48M | 156.41M | -5.23M | 230.09M | Net Income Common Stockholders |
| 126.99M | 36.27M | 48.71M | 124.01M | 45.06M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 711.58M | 655.64M | 484.99M | 594.44M | 652.22M | Total Assets |
| 3.59B | 3.18B | 3.07B | 3.34B | 3.95B | Total Debt |
| 1.48B | 1.34B | 1.05B | 1.06B | 1.32B | Net Debt |
| 765.03M | 682.23M | 566.14M | 502.82M | 726.14M | Total Liabilities |
| 2.51B | 2.28B | 2.34B | 2.68B | 3.14B | Stockholders Equity |
| 898.51M | 885.08M | 669.64M | 619.75M | 748.94M |
| Cash Flow | Free Cash Flow | |||
| 243.29M | 345.31M | 165.60M | 363.89M | 219.44M | Operating Cash Flow |
| 315.35M | 405.20M | 224.36M | 417.19M | 304.26M | Investing Cash Flow |
| -96.99M | -90.71M | -53.33M | 121.13M | -77.59M | Financing Cash Flow |
| -149.02M | -146.88M | -233.21M | -819.54M | -13.10M |
BGC Group Technical Analysis
Positive
9.50
Price Trends
9.36
Positive
9.51
Negative
9.33
Positive
Market Momentum
0.07
Negative
53.54
Neutral
79.40
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BGC, the sentiment is Positive. The current price of 9.5 is above the 20-day moving average (MA) of 9.26, above the 50-day MA of 9.36, and above the 200-day MA of 9.33, indicating a bullish trend. The MACD of 0.07 indicates Negative momentum. The RSI at 53.54 is Neutral, neither overbought nor oversold. The STOCH value of 79.40 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for BGC.
BGC Group Risk Analysis
BGC Group disclosed 60 risk factors in its most recent earnings report. BGC Group reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
BGC Group Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
82 Outperform | $94.37B | 27.16 | 13.26% | 3.96% | 9.88% | 9.18% | |
79 Outperform | $23.06B | 30.22 | 18.42% | 1.12% | 8.51% | 1.13% | |
77 Outperform | $100.99B | 36.73 | 10.32% | 1.02% | 15.32% | 14.02% | |
73 Outperform | $8.10B | 29.32 | 20.45% | 1.40% | 9.06% | 6.10% | |
72 Outperform | $44.67B | 40.27 | 10.15% | 1.21% | 21.96% | -8.37% | |
69 Neutral | $4.59B | 38.36 | 14.24% | 0.72% | 11.73% | 242.82% | |
64 Neutral | $14.53B | 10.25 | 8.67% | 4.22% | 16.51% | -12.20% |
* Financial Sector Average
Performance Comparison
BGC
BGC Group
9.50
1.80
23.38%
CBOE
Cboe Global Markets
220.27
38.76
21.35%
CME
CME Group
261.85
56.09
27.26%
ICE
Intercontinental Exchange
176.36
40.54
29.85%
MKTX
Marketaxess Holdings
219.01
2.66
1.23%
NDAQ
Nasdaq
76.36
14.12
22.69%
BGC Group Earnings Call Summary
Earnings Call Date: Feb 14, 2025 | % Change Since: 0.32% | Next Earnings Date: Apr 30, 2025
Earnings Call Sentiment Positive
The earnings call reflected a largely positive outlook with record revenues, strong growth across key segments, and successful acquisitions contributing to the company's growth trajectory. However, challenges in credit and equities revenues, as well as initially lower margins for new acquisitions, were noted.Highlights
Record-Breaking Revenue and Growth
BGC delivered record fourth quarter and full-year revenues, growing by 11% and 12% respectively, driven by ECS, rates, and foreign exchange businesses.
Successful Acquisition Strategy
Acquisition of Sage Energy Partners contributed significantly to revenue growth, with expectations for OTC Holdings to add more than $450 million of annual revenues.
Strong Performance Across Segments
ECS revenues grew by 28%, foreign exchange revenues by 21.3%, and data, network, and post-trade revenues improved by 10.3%.
Fenics Growth
Fenics revenues improved by 8.6% with Fenics Growth Platforms generating a 20.2% increase, primarily driven by FMX, PortfolioMatch, and Lucera.
Positive Earnings Growth
Pretax adjusted earnings grew by 16.9% to $129.5 million, and post-tax adjusted earnings increased by 21.9%.
Guidance for Continued Growth
First quarter 2025 guidance expects 10% revenue growth and 13% earnings growth, indicating continued positive momentum.
Lowlights
Decline in Credit and Equities Revenues
Credit revenues decreased by 4.9% due to lower CDS and emerging market credit volumes. Equities revenues declined 3.5% due to lower Asian equity derivative volumes.
Lower Margins for New Acquisitions
OTC Holdings is expected to have lower margins initially, around 15%, although it will be highly accretive from day one.
Company Guidance
During the fourth quarter earnings call for BGC Group, Inc., comprehensive guidance was provided highlighting several key financial metrics and strategic initiatives. The company achieved record revenues for both the fourth quarter and the full year 2024, with growth rates of 11% and 12%, respectively. Total revenues for the fourth quarter increased by 10.8% to $572.3 million, driven by robust performance in ECS, rates, and foreign exchange businesses. Notably, ECS revenues surged by 28% to $134.1 million, while foreign exchange revenues rose by 21.3% to $93.6 million. Despite a decline in credit and equities revenues, data, network, and post-trade revenues grew by 10.3% to $32.6 million. The company also reported improvements in Fenics revenues, which rose by 8.6% to $142.1 million, largely due to higher electronic volumes and market data revenues. Additionally, BGC's pretax adjusted earnings saw a 16.9% increase to $129.5 million, with post-tax adjusted earnings per share improving by 19% to $0.25. Adjusted EBITDA experienced a substantial 26.7% growth, reaching $192 million. Looking ahead to the first quarter of 2025, BGC anticipates generating total revenues between $610 million and $660 million, representing approximately 10% growth at the midpoint of their guidance, with expectations for pretax adjusted earnings to grow by 13% compared to the same period last year.BGC Group Corporate Events
Financial Disclosures
BGC Group Reaffirms Q1 2025 Financial Outlook
Neutral
Mar 26, 2025
On March 26, 2025, BGC Group announced an update to its financial outlook for the first quarter ending March 31, 2025, reaffirming its previously stated revenue and pre-tax adjusted earnings ranges. The announcement highlights BGC’s use of non-GAAP financial measures to provide a clearer picture of its operating performance, excluding certain non-cash items and expenses that do not reflect the company’s underlying operations. This approach is intended to align the interests of employees and management with those of shareholders, potentially impacting stakeholder perceptions and market positioning.
Executive/Board ChangesBusiness Operations and Strategy
Howard Lutnick Departs BGC Group for Commerce Role
Neutral
Feb 19, 2025
On February 18, 2025, Howard Lutnick stepped down as Chairman and CEO of BGC Group following his confirmation as the 41st U.S. Secretary of Commerce. This leadership change was amicable and due to his new role, leading to the appointment of new executives to continue BGC’s strategic initiatives. The appointments include Brandon Lutnick to the Board, Stephen Merkel as Chairman, and John Abularrage, JP Aubin, and Sean Windeatt as Co-CEOs, aiming to maintain and expand BGC’s position in global financial markets.
Business Operations and StrategyFinancial Disclosures
BGC Group Reaffirms Q4 2024 Financial Outlook
Neutral
Dec 31, 2024
BGC Group has updated its outlook for the fourth quarter of 2024, reaffirming its previously stated ranges for revenue and pre-tax Adjusted Earnings. This update reflects the company’s continued focus on its financial performance and strategic management of its operations, including the use of non-GAAP financial measures to assess its performance.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.