* Note: Prices are in Million (M) USD.
Description:
Tradeweb Markets Inc. creates and operates electronic marketplaces in the Americas, Europe, the Middle East, Africa, Asia Pacific and internationally.
These criteria used Company's Cash, EBITDA and Debt balance to determines its fair value:
Cash : $1,630 M
Debt : $32 M
EBITDA : $1,082 M
Since Cash is greater than Total Debt, 5 points assigned.
This criteria used industry in which company operates:
Sector: Financial services
Industry: Capital markets
Based on industry, 3 points assigned.
This criteria used Company's Price To Earning (P/E) Ratio to determines its fair value:
Forward PE Ratio: 31.25
Since Forward PE Ratio is between 25 - 35, 1 point assigned.
This criteria used Company's ability to convert Sales into free cash flow to determine fair value:
Using last 20 overlapping fiscal years (max 20).Average Free Cash Flow: $318 M
Average Revenue: $1,769 M
Revenue Converted To Free Cash Flow (%): 18.0%
Since Free Cash Flow (FCF) to Revenue percentage is greater than 15, 3 points assigned.
This criteria used company's growth potential to calculate its fair value:
Latest Revenue (2024-12-31): $1,726 M
Revenue 4 Years Ago (2020-12-31): $893 M
Last 5 Years Average Revenue Growth: 19%
Since Revenue Growth is between 15 - 20, 4 points assigned.
This criteria used Company's ability to buy back its own share:
Latest Share Count (2024-12-31): $215 M
Share Count 5 Years Ago (2020-12-31): $188 M
Company is not buying back its own shares, 0 points assigned.
This criteria used Company's dividend payout ratio to determine its fair value:
Next Year Earnings Per Share (EPS): $4.35
Trailing 12-Month Earnings Per Share (EPS): $3.59
Average Earnings Per Share (EPS): $3.97
Dividend Per Share (DPS): $0
Payout Ratio: 11%
Dividend Yield: 0%
Since company Payout Ratio is less than 50, 2 points assigned.
Since Dividend Yield is less than 1, 0 point assigned.
This criteria used Company's Return On Equity (ROE%) to determine its fair value:
Using last 20 valid ROE years (max 20).Average ROE: 10.0%
Since Average ROE is between 10 - 20, 3 points assigned.
This criteria used Company's current price to its 52 week low price to determines its fair value:
Current Price: $124
52-Week Low: $110
Threshold Price (15% Above 52-Week Low): $127
Since Current price is within 15% threshold, 5 points assigned.
This criteria used Company's Market Cap to determines its fair value:
Market Capitalization: $28,278 M
Since Market Cap is between 10B - 100B, 2 points assigned.
% Exposure to Total Portfolio
Based on the market cap, we recommend do not exceed 3% exposure of Total Portfolio.
Value-Trade has assigned 28 points to above Tradeweb Markets Inc (TW) stock.
Heads up: One or more P/E inputs look exaggerated and may skew the blend.
• Last 5 Years Avg PE
40.00 (>2× median)
Further research is recommended; please use your own due diligence.In such cases, multiplying earnings by the long-run average P/E typically gives a closer, more reliable fair value.
Rule of thumb: Last 5 Years Avg P/E (40.00)
× EPS ($3.97) = $158.80.
Last 5 Years Avg PE 40, Fair Value PE 15, Industry Based PE 15, Growth Based PE 18, RCFC Based PE 24.38, ROE Based PE 18.03, Risk-Free Anchored PE (25% MoS) 17.08. Based on these 7 values, average assigned is 21.07. Value-Trades has assined P/E value 21.07. Since an average (Current Year EPS + Next Year EPS) earning per share is $3.97.
The fair value of Tradeweb Markets Inc (TW) stock should be (21.07 x $3.97) = $83.65.
