Assessing Nasdaq (NDAQ) Valuation After Strong Q3 Results and Adenza Synergy Progress

Nasdaq (NDAQ) just paired strong third quarter growth with a fresh balance sheet move, launching cash tender offers to retire up to $95 million of outstanding notes, a clear signal of active liability management.

See our latest analysis for Nasdaq.

Those solid Q3 numbers, coupled with the new tender offers, help explain why Nasdaq’s 15.99% year to date share price return and hefty five year total shareholder return of 132.50% still signal building, not fading, momentum despite a softer recent quarter.

If this kind of steady compounding appeals to you, it might be a good time to see what else is working in the market with fast growing stocks with high insider ownership.

But with the stock up solidly this year, short interest still low, and analysts seeing upside from here, is Nasdaq quietly undervalued on its fintech ambitions, or are investors already pricing in every leg of its next growth cycle?

Most Popular Narrative: 12.9% Undervalued

With the latest fair value estimate sitting meaningfully above Nasdaq’s recent 89.81 dollar close, the most followed narrative argues there is still upside to capture.

The analysts have a consensus price target of 100.667 dollars for Nasdaq based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of 115.0 dollars, and the most bearish reporting a price target of just 74.0 dollars.

Read the complete narrative.

Curious how steady revenue pressure, rising margins and a premium earnings multiple can still support upside from here? The full narrative unpacks the growth math behind that call, and the assumptions that keep this valuation elevated well into the next earnings cycle.

Result: Fair Value of $103.13 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, slowing fintech deal cycles and tougher regulatory or macro conditions could quickly challenge the upbeat growth and valuation assumptions that underpin this narrative.

Find out about the key risks to this Nasdaq narrative.

Another Angle on Value

Our SWS DCF model paints a cooler picture, suggesting Nasdaq’s shares are trading above an estimated fair value of 62.53 dollars. This implies the stock may be overvalued on cash flow assumptions even as analysts see upside. Which lens should long term investors trust?

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Nasdaq for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 903 undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own Nasdaq Narrative

If you see the story differently, or simply prefer digging into the numbers yourself, you can spin up a tailored view in minutes: Do it your way.

A great starting point for your Nasdaq research is our analysis highlighting 2 key rewards and 1 important warning sign that could impact your investment decision.

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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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