MarketAxess (MKTX) Trading Volume Up Over 52% in Sep, Stock Gains

MarketAxess Holdings Inc. (NASDAQ: MKTX) reported significant growth in trading volumes for the third quarter of 2024, while also announcing an expansion of its long-standing partnership with BlackRock (NYSE: BLK).

The electronic trading platform operator saw substantial increases across various product categories, setting multiple records in September. Meanwhile, the company’s stock has shown mixed performance compared to broader market indices over different time frames.

MarketAxess Reports September Trading Volume Surge

MarketAxess reported a total average daily volume (ADV) of $45.2 billion for September 2024, marking a 52.5% increase year-over-year. Total credit ADV reached a record $16.5 billion, up 40.1% from the previous year, while total rates ADV rose 60.7% to $28.7 billion.

The company set several records in September, including a U.S. high-grade ADV of $8.4 billion, up 56.2% year-over-year, and a Eurobonds ADV of $2.4 billion, a 42.3% increase. Portfolio trading ADV also saw remarkable growth, surging 191.8% to a record $1.5 billion.

For the third quarter of 2024, MarketAxess reported strong year-over-year growth across multiple categories. Total credit ADV rose 26.5% to $14.1 billion, with U.S. high-grade ADV increasing 35.7% to $7.0 billion. Emerging markets ADV grew 19.1% to $3.3 billion, while municipal bond ADV reached a record $577 million, up 48.7% from the previous year.

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BlackRock Partnership Expansion

In a separate announcement, MarketAxess revealed an expansion of its decade-long partnership with BlackRock. The collaboration, which began in 2013 for MarketAxess analytics and Open trading, will now see MarketAxess’s credit trading protocols, data, and pricing integrated into BlackRock’s Aladdin order execution management system (OEMS).

This integration is expected to enhance the client trading experience and potentially boost trading volumes for MarketAxess by providing access to a larger pool of institutional clients.

The expanded partnership comes at a time when MarketAxess is experiencing increased usage of its automation protocols, with clients relying on the company’s strategies for more than 90% of their trading volumes. The move is anticipated to further augment trading activity on the MarketAxess platform.

MKTX Stock Gains on Trading Volume Surge

As of 9:54 AM EDT at the time of writing, MarketAxess stock was trading at $263.82, up 3.49% or $8.90. The company’s market capitalization stood at $9.96 billion, with a price-to-earnings ratio of 36.73 and earnings per share of $6.93.

Despite the day’s gains, MarketAxess has underperformed the S&P 500 index in several key metrics. The stock’s year-to-date return of -9.02% contrasts with the S&P 500’s 19.34% gain, while its five-year return of -13.63% falls significantly short of the index’s 97.14% increase over the same period.

Analysts have provided a range of price targets for MarketAxess, from a low of $193.00 to a high of $310.00, with an average target of $247.36. Recent analyst actions include Goldman Sachs adjusting its price target to $233 from $204, UBS raising its target to $300 from $285, and Deutsche Bank adjusting its target to $223 from $218.

Disclaimer: The author does not hold or have a position in any securities discussed in the article.