Investors in MarketAxess Holdings Inc. (NASDAQ:MKTX) had a good week, as its shares rose 2.4% to close at US$231 following the release of its first-quarter results. Statutory earnings per share fell badly short of expectations, coming in at US$0.40, some 78% below analyst forecasts, although revenues were okay, approximately in line with analyst estimates at US$209m. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

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After the latest results, the 13 analysts covering MarketAxess Holdings are now predicting revenues of US$864.9m in 2025. If met, this would reflect a modest 6.1% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to soar 26% to US$7.31. In the lead-up to this report, the analysts had been modelling revenues of US$861.2m and earnings per share (EPS) of US$7.57 in 2025. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a small dip in their earnings per share forecasts.

Check out our latest analysis for MarketAxess Holdings

It might be a surprise to learn that the consensus price target was broadly unchanged at US$236, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. Currently, the most bullish analyst values MarketAxess Holdings at US$295 per share, while the most bearish prices it at US$179. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. The analysts are definitely expecting MarketAxess Holdings' growth to accelerate, with the forecast 8.2% annualised growth to the end of 2025 ranking favourably alongside historical growth of 5.2% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 4.8% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that MarketAxess Holdings is expected to grow much faster than its industry.

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The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for MarketAxess Holdings. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple MarketAxess Holdings analysts - going out to 2027, and you can see them free on our platform here.

Another thing to consider is whether management and directors have been buying or selling stock recently. We provide an overview of all open market stock trades  for the last twelve months on our platform, here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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