Bear Stearns upgrades electronic trading platform provider MarketAxcess Holdings (MKTX ) to outperform from peer perform.
Analyst Daniel C. Goldberg says his upgrade is based on improving fundamentals. He says recent meetings with management and recent record volumes cause him to believe the growth story is starting to come to fruition.
He also notes MarketAxcess shares are off nearly 55% from their post-IPO high. He says the growth story includes record volumes in January/February, 98% market share, expanding margins/leverage, and client and dealer growth.
Goldbert notes new growth opportunities including credit default swaps, hedge funds, and Europe. He sets a $14 2005 target. He sees 9 cents first-quarter earnings per share, 55 cents 2005 earnings per share, and 65 cents 2006 earnings per share.