TMX Group Ltd (TSE:X)
TSX:X
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TMX Group
(TSX:X)
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Rating:69Neutral
Price Target:
C$53.00
▲(10.88% Upside)
Action:DowngradedDate:03/26/26
The score is driven mainly by solid financial performance anchored by strong cash generation, plus a constructive earnings call highlighting strong organic growth and improved shareholder returns. Offsetting these positives are weaker profitability in 2025, mixed technical trend signals, and a relatively high P/E with only a modest dividend yield.
Positive Factors
Strong free cash flow
Consistent, substantial FCF (C$566.6M in 2025; FCF ~82% of net income in 2025 and ~88% in 2024) provides durable internal funding for dividends, disciplined M&A and tech investment. This cash conversion supports capital returns and cushions operating volatility tied to market activity.
Negative Factors
Material margin compression
Net margin decline from ~33% to ~14% materially reduces earnings quality despite revenue growth, implying higher operating costs, adverse mix or nonrecurring items. Sustained margin pressure would weaken cash flow growth and limit reinvestment or shareholder return capacity over coming quarters.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong free cash flow
Consistent, substantial FCF (C$566.6M in 2025; FCF ~82% of net income in 2025 and ~88% in 2024) provides durable internal funding for dividends, disciplined M&A and tech investment. This cash conversion supports capital returns and cushions operating volatility tied to market activity.
Read all positive factors
TMX Group (X) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$13.30B
Dividend Yield1.61%
Average Volume (3M)708.39K
Price to Earnings (P/E)34.9
Beta (1Y)0.29
Revenue Growth-6.09%
EPS Growth12.76%
CountryCA
Employees2,039
SectorFinancial
Sector Strength70
IndustryFinancial - Data & Stock Exchanges
Share Statistics
EPS (TTM)0.60
Shares Outstanding278,234,830
10 Day Avg. Volume648,819
30 Day Avg. Volume708,392
Financial Highlights & Ratios
PEG Ratio-2.43
Price to Book (P/B)3.05
Price to Sales (P/S)4.97
P/FCF Ratio25.63
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$59.90Price Target Upside25.31% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering5
EPS Forecast (FY)2.3
Revenue Forecast (FY)C$1.86B
TMX Group Business Overview & Revenue Model
Company Description
TMX Group Limited operates exchanges, markets, and clearinghouses primarily for capital markets in Canada and internationally. The company operates through four segments: Global Solutions, Insights & Analytics; Capital Formation; Derivatives Tradi...
How the Company Makes Money
TMX Group primarily earns revenue by operating financial markets and selling associated services to market participants (broker-dealers, institutional investors, data vendors) and issuers (public companies and those seeking to list).
1) Trading a...
TMX Group Earnings Call Summary
Earnings Call Date:Feb 05, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 04, 2026
Earnings Call Sentiment Positive
The call presents a strongly positive operational and financial picture: broad-based revenue growth across segments, record quarterly and full-year performance, significant AUM and product expansion at VettaFi, Trayport recurring revenue growth, strong capital formation and a healthy balance sheet with a dividend increase. Notable negatives include a large noncash FX-driven hit to reported EPS, elevated operating expenses driven by regulatory passthroughs, acquisition and litigation costs, some weakness in fixed income trading revenue and modest market-share erosion. Management emphasized that adjusted performance and underlying organic trends remain robust and that many expense items were one-time or acquisition-related.Positive Updates
Record Annual and Quarterly Revenue Growth
Finished 2025 with 'best year ever' performance: overall revenue +18% year-over-year for the year; organic revenue +15% (ex-acquisitions). Record Q4 revenue of $457.8 million, up 16% year-over-year.
Negative Updates
Reported EPS Decline (FX Impact)
Reported diluted EPS for Q4 was down 29% year-over-year to $0.41, driven primarily by a $0.19 per-share net noncash foreign-exchange accounting loss on U.S. dollar-denominated intercompany loans compared with noncash gains in the prior-year quarter.
Read all updates
Q4-2025 Updates
Positive
Negative
Record Annual and Quarterly Revenue Growth
Finished 2025 with 'best year ever' performance: overall revenue +18% year-over-year for the year; organic revenue +15% (ex-acquisitions). Record Q4 revenue of $457.8 million, up 16% year-over-year.
Read all positive updates
Company Guidance
The call framed clear policy and growth guidance: management reiterated Trayport’s long‑term target of high‑single to low‑double‑digit growth and signaled continued disciplined M&A to scale Global Insights and VettaFi, while maintaining financial targets — a debt/adjusted‑EBITDA target range of 1.5–2.5x (2.2x at Dec‑31/1.9x net of excess cash), ~$513M in cash and marketable securities (≈$273M excess above the ~$240M regulatory cash target), and a dividend payout target of 40–50% (Board approved a 9% increase to $0.24 quarterly, LTM payout 42%, payable Mar 6). They emphasized delivering positive operating leverage (Q4 reported operating leverage was –2% but +7% excluding CAT, recent acquisitions and litigation), sustaining organic revenue momentum (FY organic revenue +15%; Q4 organic growth ~13%), and building on recent results (record Q4 revenue $457.8M, +16% YoY; FY revenue +18% YoY; Q4 adjusted diluted EPS +22% YoY; FY adjusted diluted EPS +25% YoY), while growing platform metrics such as VettaFi AUM +49% to >US$77B and Trayport ARR ~CAD276M/GBP150M (up ~17%/14% YoY).TMX Group Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
71
Positive
Cash Flow
77
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 2.92B | 1.46B | 2.90B | 1.11B | 980.70M |
| Gross Profit | 1.23B | 958.80M | 2.81B | 749.30M | 662.60M |
| EBITDA | 2.12B | 2.46B | 2.38B | 1.57B | 658.00M |
| Net Income | 415.70M | 481.50M | 356.00M | 542.70M | 338.50M |
Balance Sheet | |||||
| Total Assets | 50.72B | 40.21B | 64.34B | 55.98B | 63.20B |
| Cash, Cash Equivalents and Short-Term Investments | 757.60M | 433.40M | 419.60M | 493.10M | 341.60M |
| Total Debt | 2.17B | 2.17B | 1.15B | 1.11B | 1.10B |
| Total Liabilities | 45.75B | 35.39B | 60.02B | 51.78B | 59.49B |
| Stockholders Equity | 4.76B | 4.58B | 4.11B | 3.99B | 3.71B |
Cash Flow | |||||
| Free Cash Flow | 566.60M | 549.70M | 459.70M | 392.20M | 390.20M |
| Operating Cash Flow | 687.80M | 623.40M | 524.90M | 444.10M | 441.40M |
| Investing Cash Flow | -259.20M | -1.17B | -289.30M | -41.40M | -203.90M |
| Financing Cash Flow | -387.70M | 562.60M | -309.20M | -292.90M | -194.80M |
TMX Group Technical Analysis
Negative
47.80
Price Trends
47.97
Negative
49.55
Negative
51.71
Negative
Market Momentum
0.31
Positive
47.27
Neutral
19.34
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:X, the sentiment is Negative. The current price of 47.8 is below the 20-day moving average (MA) of 48.25, below the 50-day MA of 47.97, and below the 200-day MA of 51.71, indicating a bearish trend. The MACD of 0.31 indicates Positive momentum. The RSI at 47.27 is Neutral, neither overbought nor oversold. The STOCH value of 19.34 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:X.
TMX Group Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | C$13.78B | 15.09 | 13.62% | 2.11% | -25.13% | 16.40% | |
71 Outperform | C$14.92B | 13.28 | 12.37% | 3.59% | -1.02% | -5.65% | |
69 Neutral | C$13.30B | 34.94 | 9.87% | 1.61% | -6.09% | 12.76% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
53 Neutral | C$1.18B | 12.71 | -29.66% | 2.96% | 14.59% | -4520.50% | |
45 Neutral | C$11.61B | -43.24 | 12.11% | ― | ― | -121.84% |
* Financial Sector Average
TSE:X
TMX Group
47.80
-3.82
-7.39%
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11.46
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14.35%
TMX Group Corporate Events
Business Operations and StrategyDividendsFinancial Disclosures
TMX Group Posts Record Q4 Revenue, Lifts Dividend Despite FX Hit to Earnings
Positive
Feb 5, 2026
TMX Group reported record fourth-quarter 2025 revenue of $457.8 million, up 16% year over year, driven by higher derivatives trading rates and volumes, increased equity trading activity, a rebound in capital formation financings on TSX and TSXV, a...
Business Operations and StrategyDividends
TMX Group Lifts Quarterly Dividend 9% Amid Ongoing Growth Focus
Positive
Feb 5, 2026
TMX Group Limited has announced a 9% increase in its quarterly dividend to $0.24 per common share, its fourth dividend hike in two years, payable on March 6, 2026 to shareholders of record as of February 20, 2026. The move, designated as an eligib...
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.