Comparing Virtu Financial (VIRT) & Nasdaq (NDAQ)

Virtu Financial (NASDAQ: VIRT) and Nasdaq (NASDAQ:NDAQ) are both finance companies, but which is the better business? We will contrast the two companies based on the strength of their earnings, risk, analyst recommendations, dividends, institutional ownership, valuation and profitability.

Dividends

Virtu Financial pays an annual dividend of $0.96 per share and has a dividend yield of 5.7%. Nasdaq pays an annual dividend of $1.52 per share and has a dividend yield of 2.0%. Virtu Financial pays out 188.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Nasdaq pays out 118.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Risk & Volatility

Virtu Financial has a beta of 0.39, meaning that its stock price is 61% less volatile than the S&P 500. Comparatively, Nasdaq has a beta of 0.76, meaning that its stock price is 24% less volatile than the S&P 500.

Valuation and Earnings

This table compares Virtu Financial and Nasdaq’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Virtu Financial $531.65 million 1.30 $20.81 million $0.51 33.14
Nasdaq $3.87 billion 3.23 $1.21 billion $1.28 58.52

Nasdaq has higher revenue and earnings than Virtu Financial. Virtu Financial is trading at a lower price-to-earnings ratio than Nasdaq, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

44.3% of Virtu Financial shares are owned by institutional investors. Comparatively, 75.4% of Nasdaq shares are owned by institutional investors. 69.9% of Virtu Financial shares are owned by company insiders. Comparatively, 1.6% of Nasdaq shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Virtu Financial and Nasdaq’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Virtu Financial 3.42% 16.54% 2.24%
Nasdaq 5.76% 12.19% 4.64%

Analyst Ratings

This is a summary of recent ratings and recommmendations for Virtu Financial and Nasdaq, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Virtu Financial 2 1 0 0 1.33
Nasdaq 0 5 3 0 2.38

Virtu Financial presently has a consensus price target of $14.33, indicating a potential downside of 15.19%. Nasdaq has a consensus price target of $74.13, indicating a potential downside of 1.05%. Given Nasdaq’s stronger consensus rating and higher possible upside, analysts clearly believe Nasdaq is more favorable than Virtu Financial.

Summary

Nasdaq beats Virtu Financial on 13 of the 16 factors compared between the two stocks.

Virtu Financial Company Profile

Virtu Financial, Inc. is a holding company. The Company is a technology-enabled market maker and liquidity provider to the financial markets across the world. It is engaged in buying or selling a range of securities and other financial instruments and earning small bid/ask spreads across various transactions. It has a single, multi-asset, multi-currency technology platform, through which it provides quotations to buyers and sellers in equities, commodities, currencies, options, fixed income and other securities on exchanges, markets and liquidity pools in various countries around the world. It makes markets in a range of different assets classes, such as Americas Equities; Europe, the Middle East and Africa (EMEA) Equities; Asia Pacific (APAC) Equities; Global Commodities; Global Currencies, and Options, Fixed Income and Other Securities. It makes markets for global banks, brokers and other intermediaries, and indirectly provides services to retail and institutional investors.

Nasdaq Company Profile

Nasdaq, Inc. (Nasdaq) is a holding company. The Company is a provider of trading, clearing, exchange technology, regulatory, securities listing, information and public company services. It manages, operates and provides its products and services through four segments: Market Services, Corporate Services, Information Services and Market Technology. Its global offerings include trading and clearing across various asset classes, trade management services, data products, financial indexes, capital formation solutions, corporate solutions, and market technology products and services. Its technology markets across the globe, supporting equity derivative trading, clearing and settlement, cash equity trading, fixed income trading and various other functions. Its Market Services segment include its equity derivative trading and clearing, cash equity trading, fixed income clearing corporation and trade management services businesses. Its Corporate Solutions business serves corporate clients.

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