Education
About Us
Working with TipRanks
Follow Us
Virtu Financial Inc. (VIRT)
NYSE:VIRT
Top Page
Virtu Financial
(NYSE:VIRT)
Select Model
Select Model
Rating:73Outperform
Price Target:
$44.00
▲(10.50% Upside)
Action:UpgradedDate:02/21/26
The score is driven by attractive valuation (low P/E with a dividend) and constructive technical momentum (trading above key moving averages with positive MACD). Financials are solid but held back by historically volatile earnings/cash flows and still-elevated leverage despite improvement. The latest earnings call was broadly positive with record results and supportive guidance, tempered by market-condition sensitivity and cost/regulatory risks.
Positive Factors
Free Cash Flow Strength
Sustained free cash flow (~$518M in 2025 and +52.8% YoY) indicates durable cash-generation ability that supports dividend payments, debt reduction and repeatable capital deployment. Strong FCF conversion historically underpins financial flexibility across market cycles.
Diversified Market-Making & VES Momentum
A diversified market-making franchise across equities, FI, FX and commodities plus accelerating VES (seven quarters of ANTI growth) strengthens recurring revenue streams and client flows. Cross-asset liquidity provision reduces single-market exposure and supports durable competitive positioning.
High Returns on Incremental Capital
Management-reported ~100% average return on incremental capital deployed in 2025 shows effective capital allocation and a scalable trading model. High incremental ROIC enables repeatable reinvestment, supports shareholder distributions and validates the firm's growth-through-capital strategy.
Negative Factors
Elevated Leverage
Although leverage improved materially, the company still operates with elevated debt relative to equity which constrains financial flexibility. Higher leverage increases vulnerability to market downturns and limits capacity for opportunistic investment or buybacks if trading revenue weakens.
Volatile Earnings & Cash Flows
Historic swings in net income and operating cash flow reduce earnings quality and make forward cash generation less predictable. For a trading-dependent business, volatility in results complicates planning, capital allocation and reliable dividend coverage through adverse market periods.
Market-Condition & Regulatory Risk
Performance materially depends on market volatility and volumes; management warns favorable conditions drove recent results. Concurrent regulatory and legal uncertainty for new product/market initiatives could delay diversification and constrain long-term growth avenues, raising execution risk.
Virtu Financial (VIRT) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$6.02B
Dividend Yield2.88%
Average Volume (3M)1.20M
Price to Earnings (P/E)7.7
Beta (1Y)0.45
Revenue Growth27.66%
EPS Growth131.25%
CountryUS
Employees969
SectorFinancial
Sector Strength70
IndustryFinancial - Capital Markets
Share Statistics
EPS (TTM)1.85
Shares Outstanding84,906,700
10 Day Avg. Volume993,373
30 Day Avg. Volume1,196,164
Financial Highlights & Ratios
PEG Ratio0.07
Price to Book (P/B)1.44
Price to Sales (P/S)0.78
P/FCF Ratio5.48
Enterprise Value/Market Cap1.68
Enterprise Value/Revenue2.79
Enterprise Value/Gross Profit4.74
Enterprise Value/Ebitda5.62
Forecast
1Y Price Target
$44.00Price Target Upside10.50% Upside
Rating ConsensusHold
Number of Analyst Covering6
EPS Forecast (FY)4.81
Revenue Forecast (FY)$2.02B
Virtu Financial Business Overview & Revenue Model
Company DescriptionVirtu Financial, Inc., a financial services company, provides data, analytics, and connectivity products to clients worldwide. The company operates in two segments, Market Making and Execution Services. Its product suite includes offerings in execution, liquidity sourcing, analytics and broker-neutral, and multi-dealer platforms in workflow technology. The company's solutions enable clients to trade on various venues across countries and in multiple asset classes, including global equities, ETFs, foreign exchange, futures, fixed income, cryptocurrencies, and other commodities. Its analytics platform provides a range of pre- and post-trade services, data products, and compliance tools for clients to invest, trade, and manage risk across markets. Virtu Financial, Inc. was founded in 2008 and is headquartered in New York, New York.
How the Company Makes MoneyVirtu Financial primarily generates revenue through its market making activities, where it earns profits from the bid-ask spread on securities trading. The company engages in high-frequency trading, executing numerous transactions at rapid speeds to take advantage of price discrepancies across different markets. Key revenue streams include transaction fees from executing trades, revenues from proprietary trading, and income from investment in financial instruments. Additionally, Virtu often enters into partnerships with exchanges and financial institutions, enhancing its trading volume and improving its market presence, which further contributes to its earnings. The firm's ability to provide liquidity in various asset classes also allows it to capitalize on market volatility, generating additional revenue during periods of heightened trading activity.
Virtu Financial Earnings Call Summary
Earnings Call Date:Jan 29, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Apr 29, 2026
Earnings Call Sentiment Positive
The call conveyed strong operational and financial results: record-high ANTI for the quarter and year, high adjusted EBITDA and margins, successful capital deployment with very high returns, and continued VES momentum. The main cautions were a sequential decline in quoted 605 spreads for retail flow, increased compensation expense, reliance on a favorable market environment (which may not persist), limited disclosure on detailed asset-class contributions, and regulatory uncertainty around new markets. Overall, positives (record revenues, margins, capital returns, and VES progress) substantially outweighed the lowlights, though several risks and transparency limitations were noted.Q4-2025 Updates
Positive Updates
Record Quarterly and Annual Trading Income
Adjusted net trading income (ANTI) of $9.7 million per day in Q4 2025, totaling $613 million for the quarter (the highest quarterly total since Q1 2021). Full-year 2025 ANTI of $8.6 million per day, totaling $2.1 billion.
Strong Segment Performance — Market Making and VES
Market Making ANTI of $7.8 million per day in Q4 and $6.7 million per day for full-year 2025. Virtu Execution Services (VES) reached $2.0 million per day for the quarter and $1.9 million per day for the year — the seventh consecutive quarter of ANTI growth for VES and a new high watermark since early 2022.
Robust Profitability and Margins
Adjusted EBITDA of $442 million for Q4 2025 with a 72% margin; adjusted EPS of $1.85 for the quarter. Full-year adjusted EBITDA of $1.4 billion with a 65% margin and adjusted EPS of $5.73, all the highest levels since 2021.
Capital Accumulation and High Returns on Capital
Invested capital increased by approximately $625 million in 2025 (about $448 million added in H2), with management reporting an average return of 100% on incremental capital over the year and a 100% return on incremental capital in the quarter.
Maintained Shareholder Distribution
Company maintained its quarterly dividend at $0.24 per share.
Operational Drivers — Favorable Market Environment and Execution
Performance benefited from favorable operating conditions: realized volatility and VIX were up, equity share volumes increased, and elevated volumes across multiple asset classes enabled strong cross-asset trading and execution.
Negative Updates
Sequential Decline in Quoted 605 Spreads
Management noted a sequential decline in the dollar value of quoted 605 spreads for the retail flow business during the quarter, indicating some weakness in that publicly reported metric despite overall strong results.
Rising Compensation Expense
Full-year 2025 cash compensation ratio at 19% (within historical range) increased due to investments in retaining and acquiring talent across trading and technology, putting upward pressure on operating expenses.
Reliance on a Favorable Market Environment
Management emphasized that the quarter was positively impacted by a favorable operating environment (elevated volatility and volumes). They cautioned returns on incremental capital (100% this quarter/average) are unlikely to be sustained at that level and performance may vary quarter-to-quarter.
Limited Granularity and Disclosure on Asset-Class Contributions
Management declined to provide a detailed asset-class breakout (e.g., equities vs. fixed income/currencies/commodities/crypto), citing no intention to disclose such segmentation; this limits transparency for investors seeking product-level contribution details.
Regulatory and Legal Uncertainty for New Markets
While exploring new markets (e.g., sports/non-sports prediction/novel contracts), management noted unresolved regulatory and legal uncertainty that could constrain or delay entry and monetization in those potential growth areas.
Company Guidance
Management's guidance emphasized growing the firm's trading capital, investing in infrastructure and talent, and dynamically deploying incremental capital while maintaining the quarterly dividend of $0.24 per share; they reiterated a long‑term, through‑the‑cycle ANTI target of $10.0 million per day and a VES through‑the‑cycle target of $2.0 million per day. Key metrics cited to support that guidance included Q4 ANTI of $9.7M per day ($613M total) and full‑year 2025 ANTI of $8.6M per day ($2.1B), Market Making ANTI of $7.8M/day in Q4 ($6.7M/day for FY), VES at $2.0M/day in Q4 ($1.9M/day FY), adjusted EBITDA of $442M (72% margin) in Q4 and $1.4B (65% margin) for FY, adjusted EPS of $1.85 (Q4) and $5.73 (FY), a full‑year cash compensation ratio of 19%, and an increase in invested capital of ~$625M in 2025 (≈$448M in H2) with an average return of ~100% on that capital (management noted prior incremental returns could settle in the ~50–70% range and that total debt was increased by ~$300M to support capital expansion).Virtu Financial Financial Statement Overview
Summary
Profitability and cash generation are solid (2025 net margin ~12.9%, EBITDA margin ~37%, free cash flow ~$518M with strong growth), and leverage improved materially in 2025. Offsetting this, earnings and cash flows have been volatile across years and leverage remains elevated, reducing predictability and balance-sheet flexibility.Income Statement
Revenue rebounded strongly in 2025 (up 3.9% vs. 2024 and well above 2023 levels), and profitability remains solid with a 2025 net margin of ~12.9% and EBITDA margin of ~37.0%. However, margins have been volatile over time (notably lower gross/EBITDA margins in 2025 vs. 2024), and net income has swung materially across years (down sharply in 2023, then recovering in 2024–2025), which reduces earnings quality and predictability.74
Positive
Balance Sheet
Leverage is the key constraint. Debt relative to equity improved meaningfully in 2025 (debt-to-equity ~2.0 vs. ~4.6 in 2024 and ~5.8 in 2023), and equity increased versus 2023–2024, which is a positive de-risking signal. That said, the company still operates with elevated leverage for the sector, and returns on equity have been strong but somewhat inconsistent (roughly ~11.8% to ~44.2% across the period), suggesting performance can be highly cycle/market-condition dependent.55
Neutral
Cash Flow
Cash generation is generally positive, with 2025 free cash flow at ~$518M and very strong reported free-cash-flow growth (+52.8%) versus 2024. Free cash flow has also been close to net income in most years (near 1.0 in 2025 and ~0.85–0.98 in 2020–2024), supporting earnings conversion. The main weakness is volatility: operating cash flow and free cash flow declined sharply in 2022–2023 before recovering, and the 2025 operating cash flow coverage figure is notably low versus prior years, signaling potentially weaker cash coverage dynamics in the most recent period.63
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 3.63B | 2.88B | 2.29B | 2.36B | 2.81B |
| Gross Profit | 1.74B | 1.77B | 1.39B | 1.35B | 1.69B |
| EBITDA | 1.35B | 1.39B | 1.05B | 1.01B | 1.35B |
| Net Income | 468.36M | 276.42M | 142.04M | 265.03M | 476.88M |
Balance Sheet | |||||
| Total Assets | 20.15B | 15.36B | 14.47B | 10.58B | 10.32B |
| Cash, Cash Equivalents and Short-Term Investments | 4.25B | 872.51M | 820.44M | 981.58M | 1.07B |
| Total Debt | 3.98B | 5.71B | 6.93B | 3.73B | 3.60B |
| Total Liabilities | 18.18B | 13.87B | 13.06B | 8.93B | 8.46B |
| Stockholders Equity | 1.97B | 1.25B | 1.20B | 1.34B | 1.55B |
Cash Flow | |||||
| Free Cash Flow | 518.39M | 544.68M | 415.65M | 679.60M | 1.15B |
| Operating Cash Flow | 518.39M | 598.99M | 491.78M | 706.80M | 1.17B |
| Investing Cash Flow | -40.62M | -61.85M | -94.48M | -29.53M | -87.35M |
| Financing Cash Flow | -281.05M | -469.56M | -585.03M | -735.75M | -957.86M |
Virtu Financial Technical Analysis
Positive
39.82
Price Trends
36.06
Positive
35.09
Positive
38.02
Positive
Market Momentum
0.88
Positive
62.20
Neutral
80.71
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For VIRT, the sentiment is Positive. The current price of 39.82 is above the 20-day moving average (MA) of 38.72, above the 50-day MA of 36.06, and above the 200-day MA of 38.02, indicating a bullish trend. The MACD of 0.88 indicates Positive momentum. The RSI at 62.20 is Neutral, neither overbought nor oversold. The STOCH value of 80.71 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for VIRT.
Virtu Financial Risk Analysis
Virtu Financial disclosed 46 risk factors in its most recent earnings report. Virtu Financial 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
Virtu Financial Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | $6.02B | 7.67 | 30.87% | 2.88% | 27.66% | 131.25% | |
71 Outperform | $5.15B | 21.73 | ― | 3.69% | 51.19% | 456.59% | |
71 Outperform | $7.48B | 23.03 | ― | 0.58% | 23.16% | 64.04% | |
70 Outperform | $6.72B | 18.62 | 16.17% | ― | 32.53% | 13.38% | |
70 Outperform | $6.55B | 26.52 | 19.46% | 1.66% | 3.96% | -20.33% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
62 Neutral | $5.82B | 20.78 | 21.65% | 1.63% | 12.77% | 36.43% |
* Financial Sector Average
VIRT
Virtu Financial
39.82
4.97
14.25%
SNEX
StoneX Group
128.67
47.38
58.29%
MKTX
Marketaxess Holdings
181.23
-9.89
-5.17%
PIPR
Piper Sandler
326.85
52.14
18.98%
MC
Moelis
63.18
-4.36
-6.46%
PJT
PJT Partners
151.63
-6.93
-4.37%
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.