OTC Markets Group (OTCM) AI Stock Analysis

• Market Cap: $633.24M
• Dividend Yield: 1.36%
• Average Volume (3M): 5.60K
• Price to Earnings (P/E): 22.2
• Beta (1Y): 0.13
• Revenue Growth: 6.23%
• EPS Growth: 2.86%
• Country: US
• Employees: 134
• Sector: Financial
• Sector Strength: 70
• Industry: Financial - Data & Stock Exchanges
• EPS (TTM): 0.92
• Shares Outstanding: 11,975,122
• 10 Day Avg. Volume: 1,773
• 30 Day Avg. Volume: 5,596
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.02
• Enterprise Value/Revenue: 5.94
• Enterprise Value/Gross Profit: 11.48
• Enterprise Value/Ebitda: 18.07
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0

• Rating: 77 Outperform
• Price Target: $58.00 ▲(14.85% Upside)

OTC Markets Group's strong financial performance and positive earnings call are the most significant factors contributing to the score. While technical indicators suggest neutral momentum, the company's strategic initiatives and revenue growth provide a solid outlook. Valuation metrics are reasonable, supporting the overall positive assessment.

OTC Markets Group Business Overview & Revenue Model

Company Description

OTC Markets Group (OTCM) operates a financial market platform that facilitates the trading of over-the-counter (OTC) securities. The company provides a range of services to support the trading of securities not listed on major exchanges, serving a diverse group of clients including broker-dealers, issuers, and investors. OTCM's core products include the OTCQX, OTCQB, and Pink Markets, which cater to different types of companies and investors, along with providing market data and information services to enhance transparency and facilitate trading.

How the Company Makes Money

OTC Markets Group generates revenue through multiple streams including transaction fees from trades executed on its platforms, subscription fees from companies seeking to be listed and maintain their status on its marketplaces, and fees for market data services provided to brokers and investors. The company also earns revenue from advertising and sponsorships on its websites. Key partnerships with broker-dealers and financial institutions enhance its trading volume, thereby contributing to its earnings through increased transaction fees.

OTC Markets Group Financial Statement Overview

Summary

OTC Markets Group demonstrates strong financial performance with robust profitability, a stable balance sheet, and excellent cash flow generation. The income statement shows healthy revenue growth and profitability, although slight margin compression is noted. The balance sheet is solid with conservative leverage and impressive return on equity, despite a decrease in stockholders' equity. Cash flow analysis is particularly strong, highlighting effective cash management and financial flexibility.

Income Statement

The income statement reflects strong profitability with a steady gross profit margin around 51.7% and a robust net profit margin of 25.3% for TTM. Revenue growth is moderate at 7.2% from the previous period, indicating healthy expansion, while stability is highlighted by consistent EBIT and EBITDA margins. However, declining EBIT and EBITDA margins from prior years could signal slight operational cost pressures.

Balance Sheet

The balance sheet is solid with a debt-to-equity ratio of 0.31, indicating conservative leverage. The equity ratio stands at 44.7%, showing a balanced capital structure. Return on equity is impressive at 71.4%, reflecting efficient use of shareholder funds. The high cash position relative to debt further strengthens financial stability, although a decrease in stockholders' equity from the previous year is a point to monitor.

Cash Flow

Cash flow analysis is robust, with a strong free cash flow to net income ratio exceeding 100%, indicating excellent cash generation relative to profits. Operating cash flow to net income ratio is similarly strong at 1.2 times. Free cash flow growth is steady, showcasing effective cash management. The company’s ability to cover capital expenditures comfortably enhances its financial flexibility.

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: 50.50
• 50DMA: Positive
• 100DMA: Negative
• 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 50.5 is below the 20-day moving average (MA) of 50.88, below the 50-day MA of 51.43, and below the 200-day MA of 51.17, indicating a bullish trend. The MACD of -0.03 indicates Negative momentum. The RSI at 58.72 is Neutral, neither overbought nor oversold. The STOCH value of 75.19 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
OTCM	―	$633.24M	22.16	64.10%	1.36%	6.23%	2.86%
CME	―	$94.80B	25.35	13.35%	4.09%	5.84%	8.51%
CBOE	―	$24.77B	27.28	20.64%	1.09%	18.99%	17.97%
NDAQ	―	$48.91B	30.46	14.07%	1.17%	16.41%	68.03%
ICE	―	$86.22B	30.19	10.89%	1.27%	11.44%	29.10%
Sector *	―	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
MORN	―	$9.04B	23.74	24.42%	0.87%	7.97%	15.92%

OTC Markets Group Corporate Events

OTC Markets Group Reports Strong Q2 Earnings

The recent earnings call for OTC Markets Group conveyed an overall positive sentiment, highlighting robust revenue growth across various segments and the successful launch of new initiatives. Despite some challenges, such as increased operating expenses and a decline in specific revenue streams, the company demonstrated strong performance and strategic advancements.

OTC Markets Group Reports Strong Q2 2025 Results

OTC Markets Group Inc. operates regulated markets for trading 12,000 U.S. and international securities, providing essential market infrastructure through its OTC Link Alternative Trading Systems. The company recently announced its financial results for the second quarter of 2025, showcasing growth in revenue, operating income, and earnings.