Nasdaq (NDAQ) Stock Forecast & Price Target

Nasdaq has demonstrated strong financial performance, with a notable ~17% year-over-year increase in Index revenue, propelled by a ~25% rise in average ETP assets under management, reaching approximately $663 billion in the quarter. The company's robust growth is further reflected in its annual recurring revenue (ARR) with a solid ~9% year-over-year growth rate, driven by a ~12% increase in SaaS revenue, which now constitutes 37% of total ARR. Additionally, Nasdaq's progress in reducing its gross leverage ratio to 3.2x, along with strong free cash flow generation enabling proactive debt repayment, underscores its financial stability and positions it well for future growth opportunities.

The analysis indicates a negative outlook on Nasdaq's stock, primarily due to a projected 10% reduction in FY26E EPS, stemming from a slower than anticipated recovery in capital market activity and challenges with growth in its financial technology segment, particularly Adenza. Additionally, the ongoing subdued IPO market, elevated company delistings, and potential integration difficulties with recent acquisitions such as AxiomSL and Calypso pose significant risks to Nasdaq’s operational efficiency and revenue generation. Regulatory uncertainties, including the potential implementation of a financial transaction tax in the European Union, could further exacerbate declines in trading volumes, negatively impacting Nasdaq's overall financial performance.