| Valuation method | Value, $ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 65.41 | -30 |
| Intrinsic value (DCF) | 21.21 | -77 |
| Graham-Dodd Method | n/a | |
| Graham Formula | 56.66 | -40 |
Nasdaq, Inc. (NDAQ) is a global technology leader serving capital markets and other industries, operating one of the world's largest electronic securities exchanges. Headquartered in New York, Nasdaq provides a comprehensive suite of services across four key segments: Market Technology, Investment Intelligence, Corporate Platforms, and Market Services. The company's Market Technology segment offers cutting-edge anti-financial crime solutions, including Nasdaq Trade Surveillance and Verafin, while its Investment Intelligence segment delivers critical market data, indexes, and analytics. Nasdaq's Corporate Platforms segment supports public companies with listing services and governance solutions, hosting over 4,100 listed companies as of 2021. As a pioneer in electronic trading since 1971, Nasdaq has evolved into a diversified financial infrastructure and technology provider, facilitating trading across equities, derivatives, fixed income, commodities, and digital assets. The company's strategic focus on financial technology innovation positions it at the forefront of market digitization, regulatory technology, and ESG investing trends.
Nasdaq presents an attractive investment proposition as a diversified financial infrastructure company with strong recurring revenue streams from its technology and data businesses. The company benefits from high barriers to entry in exchange operations, a growing market share in anti-financial crime technology, and increasing demand for market data and analytics. With a market capitalization of $47 billion and consistent profitability (FY revenue $7.4B, net income $1.1B), Nasdaq demonstrates financial stability. However, investors should consider exposure to cyclical trading volumes, regulatory risks inherent in financial markets, and increasing competition in financial technology. The company's 1.008 beta suggests market-correlated performance, while its $0.96 dividend provides income potential. Nasdaq's strategic acquisitions (like Verafin) and technology investments position it well for long-term growth in digital finance.
Nasdaq maintains competitive advantages through its dual role as both a market operator and technology provider. As the second-largest U.S. exchange by market cap, it benefits from network effects - more listings attract more liquidity, which in turn attracts more participants. The company's Market Technology segment differentiates through specialized compliance solutions like Trade Surveillance and Verafin's anti-money laundering tools, which are becoming essential in increasingly regulated markets. Nasdaq's index business competes with scale, offering benchmarks like the Nasdaq-100 that underpin billions in ETF assets. However, the company faces pressure from all sides: traditional exchanges are expanding into technology services (like ICE), while fintech startups challenge in surveillance and analytics. Nasdaq's response has been strategic diversification - reducing reliance on volatile transaction revenues (now ~30% of total) by growing higher-margin SaaS and data businesses. The company's technology stack gives it an edge in processing speed and reliability, critical for high-frequency trading. Looking ahead, Nasdaq's ability to integrate its acquisitions and maintain innovation in areas like cloud services and cryptocurrency infrastructure will determine its competitive positioning against more agile fintech players and better-capitalized traditional rivals.