Nasdaq (NDAQ) Q2 Earnings: What Lies Ahead For The Stock?

Nasdaq, Inc. (NASDAQ:NDAQ) is slated to report second-quarter 2017 results on Jul 26, before the market opens. Last quarter, the company delivered a positive earnings surprise of 4.76%. Let’s see how things are shaping up for this announcement.

Factors to be Considered this Quarter

Nasdaq is likely to report bottom-line growth in the soon-to-be-reported quarter, fueled by higher revenues and better-than-expected performance across all the segments. Also, continued share buybacks should have boosted its bottom line.

The securities exchange’s net revenue growth can be attributable to net revenues from the company’s 2016 acquisitions of ISE, Marketwired, Boardvantage and Nasdaq CXC, along with organic growth in the non-trading segments.

Further, the company has likely achieved a substantial amount of annualized run rate cost synergies across the aforementioned four 2016 acquisitions. Notably, the securities exchange is anticipated to deliver on the full synergy potential of $60 million by the end of 2017.

However, Nasdaq has likely reported increased operating expenses in the soon-to-be-reported quarter.

With respect to the surprise trend, the company delivered positive surprises in three of the last four quarters with an average beat of 2.31%.

Earnings Whispers

Our proven model does not conclusively show that Nasdaq is likely to beat on earnings this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here as you will see below.

Zacks ESP: Nasdaq has an Earnings ESP of 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at 96 cents. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

Zacks Rank: Nasdaq carries a Zacks Rank #3.

Conversely, we caution against the Sell-rated stocks (#4 or 5) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

Other Stocks to Consider

Some better-ranked companies from the finance sector with the right combination of elements to come up with an earnings beat this quarter are as follows:

CNA Financial Corporation (NYSE:CNA) , which is set to report its second-quarter earnings on Jul 31, has an Earnings ESP of +4.00% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Sun Life Financial Inc. (TO:SLF) has an Earnings ESP of +2.74% and a Zacks Rank #1. The company is set to report its second-quarter earnings on Aug 9.

Manulife Financial Corporation (NYSE:MFC) has an Earnings ESP of +10.00% and a Zacks Rank #1. The company is slated to report its second-quarter earnings on Aug 9.

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