OTC Markets Group (OTCM) AI Stock Analysis

• Market Cap: $687.49M
• Dividend Yield: 1.25%
• Average Volume (3M): 6.61K
• Price to Earnings (P/E): 25.3
• Beta (1Y): 0.19
• Revenue Growth: 4.00%
• EPS Growth: -0.07%
• Country: US
• Employees: 134
• Sector: Financial
• Sector Strength: 80
• Industry: Financial - Data & Stock Exchanges
• EPS (TTM): 0.81
• Shares Outstanding: 11,975,122
• 10 Day Avg. Volume: 6,798
• 30 Day Avg. Volume: 6,609
• PEG Ratio: N/A
• Price to Book (P/B): 18.42
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 22.62
• Enterprise Value/Market Cap: 1.02
• Enterprise Value/Revenue: 1.68
• Enterprise Value/Gross Profit: 12.54
• Enterprise Value/Ebitda: 5.01
• 1Y Price Target: $57.00
• Price Target Upside: -0.71% Downside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 73 Outperform
• Price Target: $67.00 ▲(16.70%Upside)

OTC Markets Group's strong financial performance, characterized by robust profitability and cash flow, is the primary driver of its overall score. The technical analysis indicates bullish momentum but caution due to overbought signals. The valuation is moderately attractive, offering some income potential.

OTC Markets Group Business Overview & Revenue Model

Company Description

OTC Markets Group Inc. engages in the financial market business in the United States and internationally. It offers OTC Link Alternative Trading System, an interdealer quotation and trade messaging system; OTC Dealer, a real-time, front-end application that provides consolidated quotation, trading, and information system to attract and access market liquidity; OTC FIX, which uses the industry standard FIX protocol for quote submission, trading, and routing of execution reports; and OTC Link Electronic Communication Networks (ECN) and OTC Link National Quotation Bureau (NQB) that acts as the executing party on an agency basis in relation to transactions executed on platforms. The company also provides OTC Markets Real-Time Data products that provides quote, trade, and reference data for OTC Link ATS; OTC Markets Pricing and Reference Data products for detailed view into the securities and issuers within the OTC market; and compliance data products. In addition, it offers OTC Disclosure & News Service for publishing and distributing data, news, and financials; Real-Time Level 2 Quote Display, a service that companies sponsor to provide their investors with access to real-time level 2 quotes on otcmarkets.com and the issuer's Website; Blue Sky Monitoring Service for analysis, review, and guidance about a company's compliance with the United States securities laws; and Virtual Investor Conferences, which allows issuers to communicate and engages with investors, as well as operates the OTCQX Best Market, OTCQB Venture Market, and Pink Open Market. Further, it offers software, and risk and performance analytics tools for the banking and finance industries; online capital raising solutions; and OTCIQ, an investor relations portal. The company was formerly known as Pink OTC Markets Inc. and changed its name to OTC Markets Group Inc. in January 2011. OTC Markets Group Inc. was founded in 1904 and is headquartered in New York, New York.

How the Company Makes Money

OTC Markets Group generates revenue primarily through fees and services associated with the trading and listing of securities. The company earns income from market data licensing, where it charges fees to distribute its market data to financial institutions, investors, and other market participants. Additionally, OTC Markets Group collects fees from companies that list their securities on its platforms, with different fee structures depending on the market tier (OTCQX, OTCQB, or Pink). The company also derives revenue from providing issuer services, such as corporate communications and compliance tools, which help listed companies maintain visibility and adhere to market regulations. Partnerships with broker-dealers and financial service providers further enhance its service offerings and contribute to its overall revenue.

OTC Markets Group Financial Statement Overview

Summary

OTC Markets Group exhibits strong financial health with robust profitability, a healthy balance sheet, and solid cash flow performance. The income statement shows a strong net profit margin of 27.0% and efficient operations with stable revenue growth. The balance sheet is favorable with a manageable debt-to-equity ratio of 0.35, and cash flow metrics highlight efficient cash generation and stability.

Income Statement

OTC Markets Group's income statement shows strong profitability with a consistent Gross Profit Margin of 56.4% in 2024. The Net Profit Margin is robust at 27.0%, indicating effective cost management. Revenue growth has been stable, with a slight increase of 0.1% in the latest year. EBIT and EBITDA margins are solid at 31.8% and 34.5%, respectively, reflecting efficient operations.

Balance Sheet

The balance sheet displays a favorable equity position with a Debt-to-Equity Ratio of 0.35, suggesting manageable leverage. The Return on Equity is impressive at 76.6%, driven by strong net income. The Equity Ratio stands at 39.4%, indicating a balanced capital structure with room for future growth.

Cash Flow

Cash flow performance is strong with a consistent Operating Cash Flow to Net Income Ratio of 1.20, highlighting efficient cash generation. The Free Cash Flow increased by 0.3% year-over-year, demonstrating stable cash flow growth. The Free Cash Flow to Net Income Ratio of 1.15 underscores the company's ability to generate cash beyond its net income.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	108.54M	101.23M	101.13M	105.15M	99.91M	68.42M
Gross Profit	56.13M	57.11M	49.91M	58.62M	56.59M	36.50M
EBITDA	35.66M	34.89M	34.99M	38.91M	39.81M	23.20M
Net Income	27.41M	27.36M	27.05M	30.81M	30.48M	18.27M
Balance Sheet
Total Assets	86.05M	90.74M	90.53M	89.62M	82.25M	64.81M
Cash, Cash Equivalents and Short-Term Investments	32.89M	39.03M	37.72M	37.37M	50.39M	33.73M
Total Debt	12.07M	12.47M	13.95M	15.24M	16.46M	16.29M
Total Liabilities	47.63M	55.02M	58.30M	59.81M	57.30M	45.26M
Stockholders Equity	38.42M	35.72M	32.23M	29.80M	24.95M	19.55M
Cash Flow
Free Cash Flow	31.87M	31.57M	31.47M	32.24M	45.06M	24.98M
Operating Cash Flow	32.76M	32.87M	33.04M	33.68M	46.46M	26.01M
Investing Cash Flow	-1.13M	-2.19M	-5.19M	-16.39M	-1.40M	-1.03M
Financing Cash Flow	-29.95M	-30.24M	-31.10M	-30.31M	-28.40M	-19.46M

OTC Markets Group Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 57.41
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For OTCM, the sentiment is Positive. The current price of 57.41 is above the 20-day moving average (MA) of 54.93, above the 50-day MA of 51.66, and above the 200-day MA of 49.97, indicating a bullish trend. The MACD of 2.13 indicates Negative momentum. The RSI at 61.52 is Neutral, neither overbought nor oversold. The STOCH value of 58.10 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for OTCM.

OTC Markets Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NDAQ	83 Outperform	$51.33B	40.54	11.43%	1.21%	25.89%	16.37%
CBOE	80 Outperform	$24.61B	30.81	18.93%	1.07%	15.76%	1.97%
CME	79 Outperform	$99.13B	27.65	13.40%	1.82%	11.72%	13.31%
ICE	79 Outperform	$103.55B	37.38	10.27%	1.06%	13.25%	10.82%
OTCM	73 Outperform	$687.49M	25.32	73.60%	1.25%	4.00%	-0.07%
Sector *	67 Neutral	$16.77B	11.73	9.77%	3.75%	12.07%	-8.28%
DNB	62 Neutral	$4.07B	―	-0.64%	2.19%	2.52%	42.27%