Marex Group plc (MRX) AI Stock Analysis

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Marex Group plc

(NASDAQ:MRX)

Rating:70Outperform

Price Target:

$43.00

▲(11.46%Upside)

Marex Group plc's overall score is driven by strong financial performance and robust earnings call results, indicating strategic growth and resilience. The valuation offers moderate appeal, while technical indicators suggest cautious sentiment. Addressing cash flow sustainability and liabilities could enhance long-term prospects.

Positive Factors

Revenue Growth

The favorable trading environment with elevated volatility and volumes is expected to support MRX’s robust trading revenue growth.

Strategic Initiatives

Continued momentum in strategic initiatives, especially in prime services and Middle East expansion, is expected to further support revenue growth.

Negative Factors

Acquisitions

MRX has not announced any new acquisitions since the Hamilton Court announcement, attributed to a tougher deal-making backdrop.

Stock Valuation

The stock has experienced a robust rally, with a 64% increase in 2024 and 16% YTD, but there is limited room for further upward re-rating.

Marex Group plc (MRX) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$2.75B

Dividend Yield1.48%

Average Volume (3M)1.41M

Price to Earnings (P/E)13.0

Beta (1Y)0.56

Revenue GrowthN/A

EPS GrowthN/A

CountryUS

Employees2,425

SectorGeneral

Sector StrengthN/A

IndustryFinancial - Capital Markets

Share Statistics

EPS (TTM)0.91

Shares Outstanding71,231,705

10 Day Avg. Volume933,287

30 Day Avg. Volume1,406,967

Financial Highlights & Ratios

PEG Ratio0.31

Price to Book (P/B)2.75

Price to Sales (P/S)0.00

P/FCF Ratio2.37

Enterprise Value/Market Cap2.30

Enterprise Value/Revenue0.89

Enterprise Value/Gross Profit4.90

Enterprise Value/Ebitda5.04

Forecast

1Y Price Target

$53.67

Price Target Upside39.11% Upside

Rating ConsensusStrong Buy

Number of Analyst Covering6

Marex Group plc Business Overview & Revenue Model

Company DescriptionMarex Group plc, a financial services platform provider company, provides liquidity, market access, and infrastructure services to clients in the energy, commodities, and financial markets in the United Kingdom, the United States, and internationally. It operates through Clearing, Agency and Execution, Market Making, and Hedging and Investment Solutions segments. The company offers execution and clearing services in metals, agricultural products, energy and financial futures and options; liquidity and execution services for financial securities through trading desks that cover products, including foreign exchange, equities, fixed income, and others. It also operates as an agent to trade in OTC energy products using knowledge of the energy sector and relationships with clients for oil, power and gas, and shipping and freight products; and provides market-making services across commodities markets, such as metals, agricultural products, and energy markets. In addition, the company offers OTC traded hedging and customized OTC derivatives solutions; and risk management solutions across commodity markets comprising agriculture, metals, energy, and currency markets for trading houses, producers and consumers, and banks and distributors. Further, it engages in the structured notes business, which allows investors to build structured notes across asset classes, including commodities, equities, foreign exchange, and fixed-income products for private banks, independent asset managers, pension funds, and corporates. Additionally, the company offers technology platforms, including Neon, a trading, risk, and data platform; and Agile, a commodity broking platform. Marex Group plc was incorporated in 2005 and is headquartered in London, the United Kingdom.

How the Company Makes MoneyMarex Group plc generates revenue through a variety of financial services and activities. The company makes money primarily through its market-making operations, where it provides liquidity by buying and selling financial instruments, earning profits from the bid-ask spread. Additionally, Marex earns fees and commissions from executing and clearing trades for its clients across commodities, financial futures, and options markets. The company also leverages its expertise in risk management and advisory services to generate additional revenue streams. Key partnerships with exchanges and financial institutions further enhance its revenue model by facilitating access to markets and expanding its service offerings.

Marex Group plc Earnings Call Summary

Earnings Call Date:May 15, 2025

(Q1-2025)

% Change Since: -19.52%|

Next Earnings Date:Aug 13, 2025

Earnings Call Sentiment Positive

The earnings call reflected a strong overall performance for Marex in the first quarter of 2025, with significant achievements in profit growth, successful market offerings, and operational resilience. However, challenges such as agricultural segment underperformance and potential interest rate impacts were noted. Despite these lowlights, the company's robust growth and strategic initiatives have positioned it well for future success.

Q1-2025 Updates

Positive Updates

Strong First Quarter Performance

Adjusted profit before tax reached $96 million, at the top end of the preliminary range, representing a 42% increase with strong revenue growth across all business segments.

Successful Equity and Debt Offerings

Marex conducted a highly successful equity offering in April and a well-received $500 million senior notes issuance in May, demonstrating strong market support.

Record Client Activity and Operational Resilience

The company processed heightened volumes successfully, confirming the operational resilience and scalability of the Marex platform.

Agency Execution and Prime Services Growth

Agency execution revenue grew 42% to $240 million, with securities revenue up 59% and energy revenue up 20%, driven by record volumes and strong demand.

Increased Dividend

Dividend increased to $0.15 per share for Q1 2025 from $0.14 in 2024, reflecting strong earnings performance.

Negative Updates

Agricultural Segment Underperformance

Agricultural clearing revenue faced challenges due to lower client activity and higher volatility in the previous year, leading to a decrease in net commission income.

Impact of Funding Costs on Net Interest Income

Funding costs, particularly from the $500 million senior notes issuance, impacted net interest income, though deemed a necessary trade-off for liquidity.

Potential Interest Rate Challenges

Projected decreases in Fed rates could reduce adjusted profit before tax by around $20 million annually, highlighting sensitivity to interest rate changes.

Muted Metals Revenue Growth

Metals revenue growth was limited to 6% due to uncertainty from potential global tariffs on base metals.

Company Guidance

During the Marex Q1 2025 earnings call, the company reported a robust performance with several key metrics highlighted. Marex achieved an adjusted profit before tax of $96 million, a 42% increase compared to the same quarter last year. This growth was supported by a 28% rise in revenue, amounting to $467 million, and a 26% increase in total costs, which reached $365 million. The company also expanded its profit margins by 200 basis points to 21% and reported an adjusted return on equity of 30%. Notably, Marex saw a 15% year-on-year increase in exchange volumes, driven by strong client activity and a favorable operating environment, with particular strength in agency execution and the energy business. Additionally, Marex successfully managed its liquidity, maintaining a record surplus bolstered by a $500 million senior notes issuance. These developments, alongside the completion of the Aarna acquisition and an increased quarterly dividend of $0.15 per share, underscore Marex’s strategic growth and resilience in the current market landscape.

Marex Group plc Financial Statement Overview

Summary

Marex Group plc shows strong revenue growth and improved profitability. The balance sheet reflects enhanced equity strength and a favorable debt-to-equity ratio, though high liabilities need careful management. Cash flow challenges, particularly in operating cash flow, indicate potential liquidity issues that require attention. Overall, the company is on a positive growth trajectory but must address cash flow sustainability for long-term financial health.

Income Statement

Very Positive

Marex Group plc demonstrates strong revenue growth with a significant increase from $1.01B in 2022 to $2.36B in 2024. The company's gross profit margin remains high at 100% due to the equivalent gross profit and total revenue figures, indicating efficient cost management. The net profit margin improved to 9.25% in 2024 from 6.80% in 2023, showcasing enhanced profitability. The EBIT margin also reflects significant improvement, highlighting effective operational management. However, the absence of EBITDA data for 2024 limits the comprehensive assessment of operational performance.

Balance Sheet

Positive

The balance sheet reflects a solid financial position with increasing stockholders' equity, reaching $976.9M in 2024. The debt-to-equity ratio improved substantially, indicating a stronger equity position relative to debt. The equity ratio improved to 4.02% in 2024 from 3.69% in 2023, suggesting enhanced financial stability. However, the company operates with a high level of total liabilities relative to assets, which could pose potential risks if not managed carefully.

Cash Flow

Neutral

Cash flow analysis reveals a significant decline in operating cash flow from $735M in 2023 to zero in 2024, raising concerns about cash generation capabilities. Free cash flow has also dropped to zero in 2024, indicating potential challenges in funding operations and investments internally. The absence of cash flow data for EBITDA and operating activities in 2024 further limits the ability to fully assess cash flow health.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.89B	1.88B	1.01B	825.30M	757.53M
Gross Profit	1.29B	564.60M	1.01B	825.30M	757.53M
EBITDA	865.80M	705.40M	284.30M	107.70M	18.56M
Net Income	218.00M	128.00M	91.60M	56.50M	43.82M
Balance Sheet
Total Assets	24.31B	17.75B	15.74B	5.26B	3.77B
Cash, Cash Equivalents and Short-Term Investments	5.21B	6.06B	910.10M	712.00M	291.55M
Total Debt	6.14B	3.17B	472.10M	136.60M	246.76M
Total Liabilities	23.34B	16.97B	15.07B	136.60M	3.32B
Stockholders Equity	976.90M	775.90M	677.70M	477.70M	443.79M
Cash Flow
Free Cash Flow	1.14B	722.90M	216.20M	463.50M	-49.14M
Operating Cash Flow	1.16B	735.00M	225.60M	470.80M	-45.78M
Investing Cash Flow	-35.30M	-97.60M	-46.30M	-19.80M	-31.05M
Financing Cash Flow	-37.20M	-72.80M	26.50M	-27.20M	150.88M

Marex Group plc Technical Analysis

Technical Analysis Sentiment

Positive

Last Price38.58

Price Trends

50DMA

40.07

Negative

100DMA

39.56

Negative

200DMA

35.37

Positive

Market Momentum

MACD

-0.45

Negative

RSI

48.34

Neutral

STOCH

58.46

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MRX, the sentiment is Positive. The current price of 38.58 is above the 20-day moving average (MA) of 38.42, below the 50-day MA of 40.07, and above the 200-day MA of 35.37, indicating a neutral trend. The MACD of -0.45 indicates Negative momentum. The RSI at 48.34 is Neutral, neither overbought nor oversold. The STOCH value of 58.46 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for MRX.

Marex Group plc Peers Comparison

Overall Rating

UnderperformOutperform

Sector (56)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MC	79 Outperform	$5.66B	27.64	45.36%	3.56%	42.85%	1398.33%
MRX	70 Outperform	$2.75B	13.05	16.50%	1.48%	―	―
SNEX	70 Neutral	$4.76B	16.48	16.69%	―	67.71%	19.42%
PIPR	70 Neutral	$5.60B	27.55	17.91%	1.78%	10.27%	88.77%
AMRK	68 Neutral	$524.01M	14.31	5.81%	3.76%	5.48%	-54.25%
BGC	66 Neutral	$4.53B	30.63	17.07%	0.86%	21.16%	25.01%
Sector *	56 Neutral	$6.34B	18.40	-28.96%	6.02%	10.40%	-36.04%

* General Sector Average

Performance Comparison

MRX

Marex Group plc

37.89

18.66

97.04%

BGC

BGC Group

9.48

0.92

10.75%

SNEX

StoneX Group

96.96

45.29

87.65%

PIPR

Piper Sandler

311.59

71.87

29.98%

Moelis

70.14

10.31

17.23%

AMRK

A-Mark Precious Metals

20.57

-13.69

-39.96%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

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.Date of analysis: Jul 31, 2025