Is Surging Trading Activity and Higher Earnings Changing the Investment Case for TMX Group (TSX:X)?

• TMX Group Limited recently declared a CA$0.22 per share dividend payable on November 28, 2025, and reported third quarter results showing revenue of CA$418.6 million and net income of CA$120.5 million, both higher than the previous year.
• The company also announced very large year-to-date increases in trading volumes, value, and transactions across all its marketplaces, reflecting heightened activity and engagement with its financial services platforms.
• We'll look at how this surge in trading activity and stronger earnings results may influence TMX Group's overall investment narrative.

Find companies with promising cash flow potential yet trading below their fair value.

TMX Group Investment Narrative Recap

For investors considering TMX Group, the core thesis centers on the company's role as a leading operator of Canadian and global capital markets infrastructure, benefiting from recurring trading, clearing, and listing revenues. The surge in trading volumes and improved quarterly financials point to a near-term catalyst, reinforcing TMX's ability to harness market activity, yet persistent risks from rising global competition could still affect its longer-term revenue streams. If the recent momentum in trading activity can be sustained, it may offer some offset to these competitive pressures, but the effect is not likely to materially change the biggest risk facing TMX today.

Of TMX Group's recent announcements, the October disclosure of significant year-to-date increases in trading volume, value, and transactions across all marketplaces stands out. This jump in market activity closely relates to catalysts for the business, as increased demand for trading and risk management services can drive revenue growth, particularly in derivatives and data analytics segments.

However, investors should also keep in mind that, despite these positive developments, the impact of intensifying global competition on TMX's future earnings potential is a risk that...

Read the full narrative on TMX Group (it's free!)

TMX Group's outlook anticipates CA$2.0 billion in revenue and CA$692.5 million in earnings by 2028. This scenario is based on a yearly revenue growth rate of 7.3% and an earnings increase of CA$270.5 million from the current CA$422.0 million.

Uncover how TMX Group's forecasts yield a CA$62.50 fair value, a 24% upside to its current price.

Exploring Other Perspectives

Five members of the Simply Wall St Community peg TMX’s fair value between CA$36.38 and CA$62.50, covering a broad spectrum of outlooks. Yet with strong recent trading activity supporting revenue growth, it’s clear opinions differ on how global competition may shape the company’s prospects, see how your perspective aligns with others.

Explore 5 other fair value estimates on TMX Group - why the stock might be worth as much as 24% more than the current price!

Build Your Own TMX Group Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your TMX Group research is our analysis highlighting 3 key rewards that could impact your investment decision.
• Our free TMX Group research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate TMX Group's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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