Critical Analysis: Nasdaq (NDAQ) and Deutsche Börse (DBOEY)

Nasdaq (NASDAQ: NDAQ) and Deutsche Börse (OTCMKTS:DBOEY) are both large-cap finance companies, but which is the superior stock? We will compare the two companies based on the strength of their analyst recommendations, risk, valuation, dividends, profitability, earnings and institutional ownership.

Risk & Volatility

How to Become a New Pot Stock Millionaire

Nasdaq has a beta of 0.64, meaning that its stock price is 36% less volatile than the S&P 500. Comparatively, Deutsche Börse has a beta of 0.76, meaning that its stock price is 24% less volatile than the S&P 500.

Dividends

Nasdaq pays an annual dividend of $1.52 per share and has a dividend yield of 1.7%. Deutsche Börse pays an annual dividend of $0.17 per share and has a dividend yield of 1.3%. Nasdaq pays out 37.4% of its earnings in the form of a dividend.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Nasdaq and Deutsche Börse, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Nasdaq 1 6 5 0 2.33
Deutsche Börse 0 4 0 0 2.00

Nasdaq currently has a consensus target price of $86.21, indicating a potential downside of 1.80%. Given Nasdaq’s stronger consensus rating and higher possible upside, equities analysts clearly believe Nasdaq is more favorable than Deutsche Börse.

Profitability

This table compares Nasdaq and Deutsche Börse’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Nasdaq 18.49% 12.75% 4.79%
Deutsche Börse 31.94% 17.82% 0.55%

Insider & Institutional Ownership

76.4% of Nasdaq shares are held by institutional investors. Comparatively, 0.1% of Deutsche Börse shares are held by institutional investors. 0.4% of Nasdaq shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Earnings & Valuation

This table compares Nasdaq and Deutsche Börse’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Nasdaq $3.97 billion 3.69 $734.00 million $4.06 21.62
Deutsche Börse $3.17 billion 8.24 $988.22 million N/A N/A

Deutsche Börse has lower revenue, but higher earnings than Nasdaq.

Summary

Nasdaq beats Deutsche Börse on 8 of the 15 factors compared between the two stocks.

About Nasdaq

Nasdaq, Inc. provides trading, clearing, marketplace technology, regulatory, securities listing, information, and public and private company services worldwide. The company's Market Services segment offers equity derivative trading and clearing; cash equity trading; fixed income and commodities trading and clearing; and trade management services. This segment operates various exchanges and other marketplace facilities across various asset classes; and provides broker, clearing, settlement, and central depository services. Its Corporate Services segment offers investor relations products and services, including investor relations content, analytics, and advisory services; communication tools; and public relations solutions. It also provides a platform and services that enable customers to produce Webcasts for investor and public relations, marketing, and internal communications applications; and a collaboration platform for boards of directors or various teams collaborating on confidential initiatives. In addition, this segment operates various listing platforms, which offer capital raising solutions for private and public companies. The company's Information Services segment sells and distributes historical and real-time quote and trade information to market participants and data distributors; and develops and licenses Nasdaq branded indexes, associated derivatives, and financial products, as well as provides custom calculation services. Its Market Technology segment provides solutions for trading, clearing, settlement, surveillance, and information dissemination to markets. It also provides broker services through SMARTS, a managed service designed for brokers and other market participants; and enterprise governance, risk management, and compliance software and services. The company was formerly known as The NASDAQ OMX Group, Inc. and changed its name to Nasdaq, Inc. in September 2015. Nasdaq, Inc. was founded in 1971 and is headquartered in New York, New York.

About Deutsche Börse

Deutsche Börse Aktiengesellschaft operates as an exchange organization in Europe, America, and the Asia-Pacific. The company operates through four segments: Eurex, Xetra, Clearstream, and Market Data + Services. The Eurex segment engages in the electronic trading of European derivatives, commodities, and foreign exchange. It operates Eurex Repo over the counter (OTC) trading platform and electronic clearing architecture; and as a central counterparty for on-and-off exchange derivatives and repo transactions. The Xetra segment operates in the cash market through Xetra, Börse Frankfurt, and Tradegate trading venues; operates as a central counterparty for equities and bonds; and provides admission of securities to listing services. The Clearstream segment offers custody and settlement services for securities; global securities financing services and collateral management; and investment funds services. The Market Data + Services segment distributes licenses for trading and market signals; develops and sells indices; provides technology and reporting solutions for external customers; and trades in participant connectivity. Deutsche Börse Aktiengesellschaft is headquartered in Frankfurt, Germany.

Receive News & Ratings for Nasdaq Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Nasdaq and related companies with MarketBeat.com's FREE daily email newsletter.

Leave a Reply