Nasdaq, Inc.

Analysis of NDAQ (Nasdaq, Inc.)

Technical Perspective NDAQ is currently experiencing significant selling pressure, substantially underperforming the market over recent months. Trading near the midpoint of its 52-week range with a high maximum drawdown, the stock appears oversold in the short term but hasn't yet breached key support levels. The beta slightly above 1 indicates it may remain sensitive to broader market swings.

Fundamental Perspective Nasdaq shows strong operational improvement, with sequential revenue growth and expanding net income margins reflecting robust pricing power. However, low return on equity and asset turnover point to inefficiencies in capital utilization. While debt levels are manageable, the thin current ratio suggests limited liquidity flexibility.

Valuation & Risk The stock trades at a premium based on P/E ratios, and the extremely high EV/EBITDA suggests cash flow valuation is stretched. Lack of industry peer data makes relative assessment challenging. Primary risks include market-linked volatility and dependence on trading volumes, though low short interest reduces squeeze potential.

Investment Recommendation

NDAQ presents a mixed picture: fundamentally sound with improving profitability, yet fully valued and facing technical weakness. For long-term investors, the current oversold conditions near mid-range support could offer an entry point, provided they can tolerate near-term volatility. However, the premium valuation warrants caution; it may be more suitable for patient investors confident in Nasdaq's market position and efficiency initiatives. Consider dollar-cost averaging to mitigate timing risk.

RockFlow Model Forecast: Three Scenarios for 2026

Here is a 12-month outlook for NDAQ:

Over the next 12 months, key catalysts for NDAQ include the continued execution of its high-margin, recurring revenue strategy beyond traditional trading, notably in its anti-financial crime and analytics divisions, which should drive further operational improvement and pricing power. Potential risks remain heavily tied to broader market volatility, which could suppress trading volumes and investor sentiment, potentially exacerbating the stock's current technical weakness. Despite the lack of a clear analyst target, the premium valuation and stretched cash flow multiples suggest limited near-term upside, pointing to a likely trading range between the $70 support level and the $90-$95 resistance area as the market awaits clearer signs of improved capital efficiency.

Wall Street Consensus

Most Wall Street analysts are optimistic about Nasdaq, Inc.'s 12-month outlook, with consensus target around $81.41, indicating expected upside potential.

Overall, NDAQ has investment potential but also faces challenges. Here are key factors to weigh before investing.

NDAQ has demonstrated notably weak performance, with substantial declines over both short and medium-term periods amid heightened volatility.

The stock has experienced significant recent pressure, falling 20.02% over one month and 8.64% over three months, significantly underperforming the market by 8.62% during the latter period. This suggests considerable selling pressure relative to broader market conditions. The current beta of 1.024 indicates the stock's volatility is slightly above market average.

Currently trading at $80.24, NDAQ sits approximately 21% above its 52-week low but 21% below its 52-week high, positioning it near the midpoint of its annual range. With a maximum drawdown of -21.76% over the past year and recent sharp declines, the stock appears to be approaching oversold territory despite not yet testing its annual lows.

Revenue & Profitability: Nasdaq demonstrated sequential revenue growth from Q3 to Q4 2025, with revenue increasing from $1.96 billion to $2.08 billion. Profitability improved significantly, as the net income margin expanded to 24.95% in Q4 from 21.60% in Q3, driven by a substantial increase in gross profit margin to 66.92%. This indicates strong pricing power and effective cost management in the latest quarter.

Financial Health: The company maintains a moderate debt-equity ratio of 0.81 and a solid interest coverage ratio of 7.16, suggesting manageable debt levels relative to its earnings. However, the current ratio of approximately 1.0 indicates limited liquidity headroom, and the absence of reported cash flow data in this filing warrants verification of its cash generation capabilities.

Operational Efficiency: Nasdaq's operational efficiency shows room for improvement, with a relatively low return on equity of 4.24% and an asset turnover of just 0.067. The receivables turnover of 2.21 suggests a reasonable collection period, but the low overall asset utilization indicates potential inefficiency in generating revenue from its asset base.

Valuation Level: Nasdaq's current TTM PE of 25.51 and slightly higher forward PE of 26.70 suggest a premium valuation. While the PEG ratio of approximately 1.16 implies the stock is priced more in line with its expected earnings growth, the extremely high EV/EBITDA of 78.52 indicates investors are paying a significant premium for its cash flow generation. These metrics collectively point toward Nasdaq being fully valued or slightly overvalued at current levels.

Peer Comparison: A definitive peer comparison cannot be conducted without the corresponding industry average data. Nasdaq's valuation metrics can only be assessed on an absolute basis or against broader market indices, which limits the contextual analysis. For a complete assessment, industry-specific benchmarks for financial & stock exchanges would be required to determine its relative valuation position.

Volatility Risk: With a beta of 1.024, NDAQ's price movements are expected to be slightly more volatile than the broader market, closely tracking its fluctuations. This is confirmed by a substantial one-year maximum drawdown of -21.76%, indicating the stock has experienced significant peak-to-trough declines, posing a material risk for investors with a short-term horizon.

Other Risks: A notable point is the apparent absence of significant short interest, which can reduce the risk of a sharp downward move from a short squeeze but may also reflect a lack of strong contrarian bearish sentiment. Investors should also continuously monitor typical risks for an exchange operator, including regulatory changes, trading volume dependency, and technological execution risks, even though immediate concerns from short selling appear minimal.