Nasdaq (NDAQ) Stock Forecast & Price Target

Nasdaq demonstrated a robust financial performance with a notable 17% year-over-year increase in Index revenue, attributed to a strong 25% rise in average ETP assets under management, reaching approximately $663 billion. The company's annual recurring revenue (ARR) growth of about 9% year over year, alongside a 12% increase in SaaS revenue, highlights the successful expansion of its diversified segments, particularly in financial technology and capital access services. Furthermore, Nasdaq's improved gross leverage ratio of 3.2x and strong free cash flow generation, enabling significant debt repayment, further underlines its solid financial health and potential for future growth.

The negative outlook on Nasdaq's stock is driven by a projected 10% reduction in FY26E EPS, stemming from a slowdown in capital markets activity and insufficient growth from its financial technology segment, specifically Adenza, which could hinder debt repayment. Key risks affecting Nasdaq include a persistently subdued IPO market, declining trading volumes, integration challenges of acquired companies, and potential regulatory changes that could further restrain market activity. Additionally, the uncertainty surrounding a proposed financial transaction tax in Europe poses a considerable threat, as it could lead to decreased trading volumes for EU-based exchanges, impacting Nasdaq's overall performance.