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Credit Suisse analyst Gautam Sawant downgraded Nasdaq (NASDAQ:NDAQ) to Neutral from Outperform on Wednesday, following the stock’s recent outperformance relative to its exchange peers and the S&P 500.
“We believe Nasdaq’s (NDAQ) revenue growth could be pressured in the event of a recession due to having the lowest transactional revenue mix relative to peers (25% vs. 40%+ for peers) and macroeconomic factors continuing to weigh on the company’s data & technology growth trajectory,” Sawant wrote in a note to clients.
The analyst also expects operating expense growth in 2023 and 2024 at 1-2% above consensus. He continues to view Nasdaq (NDAQ) as “well positioned for digital exhaust monetization, which will be a differentiating factor for future compounding earnings growth for our Exchange coverage group.”
Sawant trims EPS estimates for 2023 to $2.72 from $2.77 and for 2024 to $2.98 from $3.05.
Nasdaq (NDAQ) stock has slipped 0.9% in Wednesday premarket trading.
His Neutral rating aligns with the Quant rating of Hold and diverges from the average Wall Street rating of Buy.
In the past six months, Nasdaq (NDAQ) stock climbed 19% compared with -10% for the S&P 500 Financial Exchanges & Data Index and -7.2% for the S&P 500 as seen in this chart.
SA contributor Leo Nelissen also sees macro challenges persisting for the company.