Strong Q3 Results and Dividend Hike Could Be a Game Changer for TMX Group (TSX:X)

• TMX Group reported strong third quarter earnings, with sales rising to CA$418.6 million and net income increasing to CA$120.5 million compared to the previous year; the board also declared a CA$0.22 per share dividend payable on November 28, 2025 to shareholders of record as of November 14, 2025.
• The company attributed its broad-based revenue growth to higher results across derivatives trading and clearing, data analytics, and other business lines, signaling continued momentum from investments in its core and high-margin segments.
• We'll explore how TMX Group's broad revenue gains, especially in derivatives and data, influence its investment narrative and growth outlook.

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

TMX Group Investment Narrative Recap

To be a shareholder in TMX Group, you need to believe in the company’s ability to grow recurring, high-margin revenue from derivatives and data analytics, even as capital markets evolve and competition intensifies. The recent strong third quarter results reinforce the near-term catalyst of robust derivatives trading, but the news does not materially alter the underlying risk that alternative funding sources and global exchanges could erode TMX’s core business and growth profile.

Among recent announcements, TMX Datalinx’s exclusive partnership with Tracxn stands out by expanding access to private market intelligence for institutional clients. This move directly supports TMX’s catalyst of growing its data and analytics division, an area highlighted by ongoing high revenue growth and recurring income streams in the latest results.

Yet, while momentum in derivatives and data is promising, investors should not overlook the fact that margin compression from rising operating expenses, even after these earnings, remains an area you need to watch out for...

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 is based on a 7.3% annual revenue growth rate and an increase in earnings of CA$270.5 million from the current level of CA$422.0 million.

Uncover how TMX Group's forecasts yield a CA$61.79 fair value, a 24% upside to its current price.

Exploring Other Perspectives

Simply Wall St Community members see TMX Group’s fair value estimates ranging from CA$28.00 to CA$70.00, with 6 independent viewpoints included. These diverse opinions highlight just how much the potential for margin compression could influence the company’s future performance, so explore multiple perspectives before making any investment decision.

Explore 6 other fair value estimates on TMX Group - why the stock might be worth as much as 40% 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 4 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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