Investing.com - Raymond James reiterated an Outperform rating and $109.00 price target on Nasdaq OMX Group Inc. (NASDAQ:NDAQ), representing a 34% upside from current levels. The stock trades at a P/E ratio of 27.1 with a notably low PEG ratio of 0.43, suggesting attractive valuation relative to growth prospects.
The firm said Nasdaq's updated medium-term financial outlook for three to five years reflects a slight increase in total solutions revenue growth versus the company's prior outlook and is broadly consistent with current consensus expectations.
Management's growth outlook for all components within Nasdaq's Financial Technology segment remains unchanged. Within its Capital Access Platform segment, the company is boosting its growth outlook for Index as well as Data & Listings but reducing its growth outlook for Workflow & Insights. The reduced Workflow & Insights outlook was attributed to a slowdown in demand for sustainability solutions.
Raymond James said it generally views Nasdaq's outlook as attainable, although it tends to have a slightly more conservative outlook than consensus in most revenue categories. The firm said it assumes market tailwinds that have boosted Index in recent years will moderate and that Verafin will not see revenue growth re-accelerate back to the mid-20% range.
According to InvestingPro, seven analysts have revised their earnings upwards for the upcoming period, with consensus forecasting EPS of $3.91 for FY2026. The platform offers 10 additional ProTips for NDAQ subscribers.
Nasdaq is introducing a gross leverage target of the mid-to-high 2x range, which compares to 2.9x at the end of 2025, Raymond James said.
In other recent news, Nasdaq Inc. reported robust financial results for the fourth quarter of 2025, with earnings per share (EPS) reaching $0.96, surpassing analysts' expectations of $0.92. Revenue for the quarter came in at $1.4 billion, exceeding the projected $1.37 billion. Additionally, during its Investor Day presentation, Nasdaq raised its medium-term Solutions revenue growth outlook to 9-12% from the previous 8-11%. This adjustment reflects a heightened outlook for its Capital Access Platforms division and continued growth expectations for its Financial Technology division. The company also maintained its medium-term expense guidance at 5-8% and reaffirmed its 2026 expense outlook. In another development, Nasdaq introduced its Nasdaq Private Capital Indexes, a new suite of benchmarks aimed at providing transparency and standardized measurement for private markets. These indexes are constructed from over 14,000 institutional private market funds, representing more than $11.4 trillion in global assets under management.