StoneX
SNEX
$58.05
+2.34%
StoneX Group Inc. is a diversified global brokerage and financial services firm operating across four segments — Commercial, Institutional, Self-Directed/Retail, and Payments — offering execution, OTC market-making, clearing, advisory, physical commodity trading, and payment solutions to corporates, banks, institutional investors, and retail clients. Its distinctive identity rests on a hybrid model that blends high-volume, low-margin physical precious metals trading with higher-margin agency brokerage, clearing, and payments franchises, giving it a scale-driven, flow-based earnings profile that is unusual among capital markets intermediaries and increasingly resembles a global 'network' platform rather than a traditional broker. The current investor debate centers on whether StoneX can convert explosive top-line expansion — driven overwhelmingly by precious metals trading volumes — into durable per-share earnings, particularly after a sharp mid-year share-price drawdown and a Jefferies downgrade to Hold in July 2026. Sentiment has also been shaped by bolt-on M&A, including the StoneX Payments acquisition of a wholesale banknotes business (WCSI) announced in March 2026, which management frames as a margin-accretive extension of its institutional payments franchise.…
SNEX
StoneX
$58.05
Related headlines
Investment Opinion: Should I buy SNEX Today?
Rating: Hold. StoneX is a profitable, cash-generative intermediary trading at roughly 11.5x the sole analyst's $4.73 forward EPS estimate and 1.34x book against a 12.87% ROE, but the evidence does not yet support accumulation while the stock sits 41% below its June 2026 high of $92.67 and the only covering analyst, Jefferies, downgraded to Hold on July 20, 2026 with no published average price target to anchor upside. The core thesis is that the market has already repriced the low-quality, precious-metals-driven revenue base (roughly $36.65 billion of $40.19 billion in Q3 2026 revenue) but has not yet been given proof that the margin improvement is structural rather than a favorable spread quarter.
Supporting evidence is genuinely mixed but leans toward patience rather than purchase. Gross margin rose sequentially from 2.29% in Q1 2026 to 2.75% in Q2 and 3.06% in Q3, lifting gross profit to $1.23 billion from $650 million a year earlier — an 89% increase on only 15.4% revenue growth, which is the single most constructive data point in the file. Diluted EPS improved to $1.00 in Q3 2026 from $0.81 a year prior, with Q2 2026 at $2.07, and the stock trades at 0.024x sales, 10.11x EV/EBITDA, and a PEG of 0.81 — all undemanding. Against that, net margin is 0.23%, interest expense of $484.1 million consumed most of $698.6 million in operating income (coverage near 1.44x), debt-to-equity is 7.79x, and operating cash flow swung from +$4.21 billion in Q2 2026 to -$1.34 billion in Q3, so the $5.07 billion trailing FCF is not recurring earnings power.
The rating would upgrade to Buy if gross margin holds at or above 3.0% for a second consecutive quarter while the stock reclaims the $66–$70 resistance band, or if a second analyst initiates coverage with a constructive target that restores price discovery. It would downgrade to Sell on a decisive break below the $52.83 October 30, 2026 low, a gross margin rollback toward the 2.29% Q1 level, or evidence that the WCSI banknotes integration is impairing rather than accretive. On balance the stock is inexpensive relative to normalized earnings but not cheap relative to its own recent history — the trailing PE has re-rated from 5.97x in Q1 2026 to 10.81x today — so the verdict is fairly valued to modestly undervalued on forward earnings, with the discount justified by leverage, thin margins, and single-analyst coverage.
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SNEX 12-Month Price Forecast
The forward view is balanced but tilted toward caution: the margin expansion and 89% gross profit growth are real and the 11.5x forward multiple already discounts substantial pessimism, yet the stock's 33% six-month decline, 42.99% drawdown, and single-analyst coverage with no published target mean there is no mechanism to force a re-rating in the near term. The base case at 55% probability assumes EPS near $4.73 and a $58–$70 consolidation, with the bull case at 20% requiring a second consecutive quarter of 3.0%+ gross margin and the bear case at 25% pricing a rollback toward 2.29% margins and a break of the $52.83 low. I would upgrade to bullish on a confirmed Q4 gross margin above 3.0% combined with a reclaim of $66–$70, and downgrade to bearish on a close below $52.83 or evidence that the WCSI integration is dilutive. The single variable that most changes this outlook is whether the Q2–Q3 margin improvement reflects structural payments and clearing mix or a favorable precious metals spread quarter.
Wall Street consensus
Coverage is extremely thin, with only one analyst reporting estimates, so consensus statistics carry limited signal. That sole analyst projects EPS of $4.73 and revenue of $6.05 billion, and the institutional ratings history shows Jefferies downgrading the stock from Buy to Hold on July 20, 2026 — a notable negative catalyst that coincided with the stock's slide from the $90s toward the $70s. No average price target is provided in the data, so implied upside cannot be calculated; the consensus leans neutral-to-cautious given the recent downgrade and the absence of fresh Buy ratings since February 2026.
With a single estimate, the target range is effectively a point estimate ($4.73 EPS, $6.05 billion revenue), which signals low conviction rather than tight agreement. The high and low scenarios cannot be differentiated, but the implied bull case would require margin expansion and successful integration of the WCSI banknotes acquisition to lift the payments segment, while the bear case prices in continued compression of precious metals trading margins and elevated interest expense eroding net income. Limited coverage typically means higher volatility and less efficient price discovery, consistent with the 42.99% drawdown and the stock's sharp divergence from the broader market.
Bulls vs Bears: SNEX Investment Factors
The bear case currently carries stronger evidence: the stock is in a confirmed downtrend (-33.18% over six months, -42.99% max drawdown), the Jefferies downgrade removed the last Buy rating, and the revenue base is dominated by low-margin precious metals flow that the market is explicitly repricing. The bull case rests on genuinely improving unit economics — gross margin up from 2.29% to 3.06% across 2026 and gross profit up 89% year-over-year — plus a valuation of roughly 11.5x the $4.73 consensus EPS that already discounts a lot of bad news. The single most important tension is whether the margin expansion in Q2 and Q3 2026 is structural (payments, clearing, and agency mix) or merely a favorable metals-spread quarter; if it is structural, the current 10.8x trailing PE is a bargain, and if it is cyclical, a return toward the 6x PE seen in early 2026 implies meaningful further downside. Until the stock reclaims the $66 resistance band or a second analyst initiates coverage, the weight of evidence favors caution over accumulation.
Bullish
- Earnings rebound already visible: Diluted EPS climbed from $0.81 in Q3 2025 to $1.00 in Q3 2026, with Q2 2026 hitting $2.07, and the sole analyst models $4.73 for the forward year. At $54.31 that implies roughly 11.5x forward earnings, an undemanding multiple for a profitable intermediary.
- Gross margin expanding sequentially: Gross margin rose from 2.29% in Q1 2026 to 2.75% in Q2 and 3.06% in Q3 2026, lifting gross profit to $1.23 billion versus $650 million a year earlier. That is a 89% year-over-year increase in gross profit dollars on only 15.4% revenue growth, evidence the mix is shifting toward higher-margin flow.
- Deep discount on book and sales: Price-to-book of 1.34x against a 12.87% ROE and price-to-sales of 0.024x are modest for a firm generating $40.19 billion in quarterly revenue. PEG of 0.81 and EV/EBITDA of 10.11x suggest the market is not paying up for the earnings base.
- Payments franchise being scaled: The March 2026 acquisition of WCSI's wholesale banknotes business extends StoneX Payments into institutional banknote distribution, a management-framed margin-accretive bolt-on. Success here would diversify earnings away from the $36.65 billion precious metals trading line that dominates revenue.
Bearish
- Momentum breakdown is severe: The stock has fallen 33.18% over six months and 17.51% over three months, with a 42.99% max drawdown from the $92.67 June high to the $52.83 October low. One-month relative strength of -6.64 versus SPY confirms the decline is accelerating, not stabilizing.
- Revenue quality is low: Of $40.19 billion in Q3 2026 revenue, roughly $36.65 billion came from precious metals trading, versus just $332 million in commission and clearing fees and $413.5 million in retail metals sales. Headline growth is commodity-flow leverage, not franchise expansion, and can reverse quickly.
- Razor-thin margins, heavy interest burden: Net margin is 0.23% and operating margin 1.55%, while interest expense of $484.1 million consumed most of $698.6 million in operating income, leaving interest coverage near 1.44x. Earnings are highly sensitive to funding costs and any compression in trading spreads.
- Leverage and cash flow volatility: Debt-to-equity of 7.79x and total-debt-to-capitalization of 87.6% reflect a broker-dealer funding model with limited equity cushion. Operating cash flow swung from +$4.21 billion in Q2 2026 to -$1.34 billion in Q3 on a $1.52 billion working-capital drain, so the $5.07 billion trailing FCF is not recurring earnings power.
SNEX Technical Analysis
StoneX is in a clear intermediate-term downtrend despite still-positive long-term performance: the stock is up 41.97% over the trailing year and 25.49% year-to-date, but has fallen 33.18% over six months and 17.51% over three months. At $54.31, the shares sit near the bottom of their 52-week range — roughly 55% of the way up from the period low of about $52.83 (set October 30, 2026) toward the high near $92.67 (June 18, 2026) — a positioning that signals momentum breakdown rather than a clean value entry, given the persistent sequence of lower highs. The 42.99% maximum drawdown from the June peak underscores how violently the trend reversed after a strong first half.
Short-term momentum is decisively negative and accelerating to the downside: the stock is down 11.63% over the past month versus a 4.99% decline in the S&P 500, producing a relative-strength reading of -6.64, and the 3-month relative strength of -12.60 confirms sustained underperformance. This 1-month weakness directly contradicts the +41.97% 1-year gain, a classic divergence that typically signals either a trend reversal or a deep mean-reversion phase; the 6-month relative strength of -32.64 versus SPY argues the market is repricing the growth story rather than merely taking profits. Volume of roughly 579,360 shares on the latest session is modest, suggesting the decline has been orderly rather than panic-driven, but the absence of a volume-backed capitulation low leaves the bottom unconfirmed.
Key technical levels are well defined: support clusters at the $52.83–$54.92 zone (the October 30 low and late-October consolidation), while resistance sits at the $66–$70 band where the stock repeatedly failed in August and September, with major resistance at the $92.67 June high. A decisive break below $52.83 would confirm the downtrend and likely target the mid-$40s, whereas reclaiming $66 would be the first evidence of a base. Beta is not provided in the data, but the 42.99% drawdown and 33% six-month decline versus a roughly flat SPY imply materially above-market volatility, warranting smaller position sizing and wider stops for risk management.
Beta
—
—
Max Drawdown
-43.0%
Largest decline past year
52-Week Range
—
Price range past year
Annual Return
+45.3%
Cumulative gain past year
| Period | SNEX Return | S&P 500 |
|---|---|---|
| 1m | -3.9% | -2.4% |
| 3m | -13.1% | -2.3% |
| 6m | -21.0% | +2.8% |
| 1y | +45.3% | +11.3% |
| ytd | +34.1% | +11.4% |
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SNEX Fundamental Analysis
Revenue is expanding rapidly but with a composition that demands scrutiny: fiscal Q3 2026 (quarter ended June 30, 2026) revenue reached $40.19 billion, up 15.4% year-over-year from $34.83 billion, continuing a multi-quarter climb from $39.03 billion in Q1 2026 and $45.76 billion in Q2 2026. The growth is overwhelmingly driven by precious metals trading, which accounted for roughly $36.65 billion of segment revenue, dwarfing commission and clearing fees of $332 million and precious metals retail sales of $413.5 million; this means headline growth reflects physical metals flow and commodity price leverage rather than a broad-based franchise expansion. The implication for the investment case is that revenue momentum is real but low-quality and cyclical, and the market's willingness to pay for it hinges on whether higher-margin agency and payments lines can scale.
Profitability is thin but improving: Q3 2026 net income was $127.9 million on a gross margin of just 3.06% (gross profit of $1.23 billion), with an operating margin of 1.55% and a net margin of 0.23% — razor-thin figures that are nonetheless structurally normal for a flow-based broker with heavy physical trading. The trend is favorable, with gross margin rising from 2.75% in Q2 2026 and 2.29% in Q1 2026, and net income climbing from $139.0 million in Q1 to $174.3 million in Q2 before easing to $127.9 million in Q3; EBITDA held steady at $739.7 million versus $744.9 million sequentially. The key watch item is interest expense of $484.1 million, which consumed a large share of operating income of $698.6 million and keeps interest coverage near 1.44x — a reminder that earnings are highly sensitive to funding costs.
Balance-sheet leverage is the central financial risk: debt-to-equity stands at 7.79x with a total-debt-to-capitalization ratio of 87.6%, reflecting the firm's broker-dealer funding model, while the current ratio of 1.57 offers adequate short-term liquidity. Cash flow is extremely volatile — trailing free cash flow is reported at $5.07 billion, but quarterly operating cash flow swung from +$4.21 billion in Q2 2026 to -$1.34 billion in Q3 2026 on a $1.52 billion working-capital drain — so FCF should be read as a function of margin and inventory financing rather than recurring earnings power. ROE of 12.87% is respectable for the sector, but with no dividend and a payout ratio of zero, all capital is being reinvested into a balance sheet already carrying $2.19 billion in cash against outsized liabilities.
Quarterly Revenue
$40.2B
2026-06
Revenue YoY Growth
+15.4%
YoY Comparison
Gross Margin
3.1%
Latest Quarter
Free Cash Flow
$5.1B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is SNEX Overvalued?
Because net income is positive ($127.9 million in Q3 2026), the PE ratio is the appropriate primary metric, and the trailing PE of 10.81x against a forward PE of just 0.81x is a striking gap that reflects the market's expectation of a dramatic earnings rebound — though the forward figure appears distorted by the very low reported EPS of $0.096 and should be treated with caution. The more reliable read comes from the analyst consensus EPS estimate of $4.73, which implies roughly 11.5x forward earnings at the current $54.31 price, a multiple that is undemanding for a profitable financial intermediary. The PEG ratio of 0.81 and price-to-book of 1.34x both suggest the stock is not expensive on normalized earnings.
Peer comparison is constrained by the absence of a formal industry-average dataset, but the internal multiples are informative: a price-to-sales ratio of 0.024x is extraordinarily low even for a high-volume physical trading business, and the EV/EBITDA of 10.11x is moderate for capital markets intermediaries. The 1.34x price-to-book is a modest premium to tangible book, consistent with a 12.87% ROE, and the 0.73x price-to-cash-flow reflects the firm's large but volatile cash generation. On balance, the valuation looks inexpensive relative to profitability, but the discount is partly deserved given the 7.79x leverage and thin 0.23% net margin.
Historical context shows the stock has re-rated meaningfully: the PE ratio stood at 6.08x in Q2 2026 and 5.97x in Q1 2026, versus 10.81x today, while price-to-book has climbed from 1.27x in Q1 2026 to 1.34x now and price-to-sales from 0.082x to 0.024x on a trailing basis. The current multiple sits in the upper half of its recent band, suggesting the market has already priced in a recovery in earnings quality rather than offering a deep-value entry; a return toward the 6x PE seen earlier in 2026 would imply substantial downside if margins fail to hold.
PE
10.8x
Latest Quarter
vs. Historical
High-End
5-Year PE Range 3x~10x
vs. Industry Avg
21.4x
Industry PE ~21.4x*
EV/EBITDA
10.1x
Enterprise Value Multiple
Investment Risk Disclosure
Financial and operational risks are dominated by the balance sheet and earnings quality. Debt-to-equity of 7.79x with 87.6% total-debt-to-capitalization leaves little equity cushion, and interest expense of $484.1 million against $698.6 million of operating income puts interest coverage near 1.44x, meaning a rise in funding costs or a compression in trading spreads flows almost directly to net income. Revenue concentration is extreme: precious metals trading contributed roughly $36.65 billion of $40.19 billion in Q3 2026 revenue, so a normalization in metals volumes or prices would gut the top line, and the 0.23% net margin means there is almost no buffer. Cash flow is equally unstable, swinging from +$4.21 billion in Q2 2026 to -$1.34 billion in Q3 on a $1.52 billion working-capital drain, so the $5.07 billion trailing FCF should not be treated as recurring.
Market and competitive risks center on valuation compression and sentiment fragility. The trailing PE has already re-rated from 6.08x in Q2 2026 and 5.97x in Q1 2026 to 10.81x today, so the market has priced in an earnings-quality recovery that has not yet been proven; a return to the 6x band would imply substantial downside from $54.31. Coverage is a structural vulnerability — a single analyst, no published average target, and a Jefferies downgrade to Hold on July 20, 2026 — which amplifies volatility and leaves the stock exposed to headline-driven moves. The 42.99% drawdown and 33% six-month decline versus a roughly flat SPY imply materially above-market beta, and the -6.64 one-month relative strength shows the stock is being sold even as the broader market falls only 4.99%. Competitive pressure from larger, better-capitalized broker-dealers and electronic trading venues could erode the physical metals spread advantage that currently drives results.
The worst-case scenario is a simultaneous metals-spread compression and funding-cost squeeze: precious metals revenue normalizes, gross margin rolls back toward the 2.29% Q1 2026 level, interest expense stays near $484 million, and net income falls below the $85.7 million earned in Q4 2025. In that chain, the stock would retest and likely break the $52.83 October 30, 2026 low, with the mid-$40s as the next technical target — roughly -13% to -17% from the current $54.31, and as much as -50% from the $92.67 June high. A disorderly outcome, such as a failed WCSI integration or a working-capital funding disruption, could push the shares toward the low $40s, a further -25% from here, consistent with the magnitude of the 42.99% drawdown already experienced.
FAQ
Ranked by severity, the first risk is financial leverage and interest burden: debt-to-equity of 7.79x with 87.6% total-debt-to-capitalization, and $484.1 million of quarterly interest expense against $698.6 million of operating income leaves coverage near 1.44x, so a funding-cost increase flows almost directly to net income. Second is revenue concentration and earnings quality: precious metals trading generated roughly $36.65 billion of $40.19 billion in Q3 2026 revenue, and with a 0.23% net margin there is almost no buffer if metals flow or spreads normalize. Third is cash-flow volatility: operating cash flow swung from +$4.21 billion in Q2 2026 to -$1.34 billion in Q3 on a $1.52 billion working-capital drain, so the $5.07 billion trailing FCF is not recurring earnings power. Fourth is market-structure and sentiment risk: a single covering analyst, no published average target, a Jefferies downgrade to Hold on July 20, 2026, and a 42.99% max drawdown with -6.64 one-month relative strength versus SPY mean the stock can keep falling on headlines alone, independent of fundamentals.
The 12-month view splits into three scenarios. The base case carries 55% probability with a $58–$70 range, assuming the sole analyst's $4.73 EPS and $6.05 billion revenue materialize, gross margin holds in the 2.7%–3.1% band, and interest expense stays near $484 million per quarter with coverage around 1.44x. The bull case at 20% probability targets $78–$92, requiring gross margin above 3.0% for two or more consecutive quarters, accretive WCSI banknotes contribution to StoneX Payments, and a second analyst initiating coverage to restore price discovery toward the June 2026 high of $92.67. The bear case at 25% probability targets $40–$52, driven by gross margin reverting to 2.29%, a repeat of the Q3 2026 $1.52 billion working-capital drain, and a break of the $52.83 October 30, 2026 low. The base case is most likely, and its key assumption is that the Q2–Q3 margin improvement is at least partly structural rather than a single favorable metals-spread quarter.
On normalized earnings SNEX looks modestly undervalued, but on its own recent history it is no longer cheap. The trailing PE of 10.81x compares with 5.97x in Q1 2026 and 6.08x in Q2 2026, so the market has already re-rated the shares upward on an earnings-quality recovery that has not been fully proven; price-to-book has likewise drifted from 1.27x to 1.34x. Against profitability, the multiples are undemanding: 0.024x sales, 10.11x EV/EBITDA, 0.73x price-to-cash-flow, and roughly 11.5x the $4.73 consensus EPS, all supported by a 12.87% ROE. The discount is partly deserved given 7.79x debt-to-equity, a 0.23% net margin, and revenue concentration where precious metals trading was about $36.65 billion of $40.19 billion in Q3 2026. What the valuation implies is that the market expects margins to normalize downward from the 3.06% Q3 peak rather than hold; if gross margin instead stays above 3.0%, the current multiple is too low, and if it reverts to 2.29%, a return toward the 6x PE band implies meaningful further downside.
The risk/reward is balanced but not yet compelling. On the positive side, SNEX trades at about 11.5x the sole analyst's $4.73 forward EPS, 1.34x book with a 12.87% ROE, and a PEG of 0.81, while gross margin expanded from 2.29% in Q1 2026 to 3.06% in Q3 and gross profit rose 89% year-over-year to $1.23 billion. On the negative side, there is no published average price target to anchor upside, only one analyst covers the name, and Jefferies downgraded it to Hold on July 20, 2026. The biggest downside risk is a margin rollback toward 2.29% combined with $484.1 million of quarterly interest expense, which could break the $52.83 low and target the mid-$40s — roughly -13% to -25% from $54.31. It is a reasonable buy only for value-oriented investors with a multi-quarter horizon who size positions small and wait for confirmation of a second quarter of 3.0%+ gross margin or a reclaim of $66; it is not a good buy for momentum or income investors, given the -33.18% six-month trend and a zero dividend yield.
SNEX is better suited to a patient, long-term value holding than to short-term trading, but only with disciplined position sizing. The long-term case rests on a 41.97% trailing one-year gain and 25.49% YTD return versus SPY's 9.59% and 7.83%, a 12.87% ROE, and a franchise spanning Commercial, Institutional, Self-Directed/Retail, and Payments segments with 5,200 employees and a $6.5 billion market cap. The short-term case is poor: the stock is down 33.18% over six months and 11.63% over one month with -6.64 relative strength versus SPY, and a 42.99% max drawdown implies materially above-market volatility, so momentum traders face whipsaw risk around the $52.83 support and $66–$70 resistance. There is no dividend (payout ratio of zero) to compensate for waiting, and earnings visibility is limited by single-analyst coverage and spread-driven revenue. A concrete minimum holding period of 12–18 months is appropriate, long enough to see two to four quarterly gross margin prints and the WCSI integration contribution, with a reassessment trigger on any close below $52.83.