Tradeweb Markets Inc. Fundamental Analysis
Tradeweb Markets Inc. (TW) shows strong financial fundamentals with a PE ratio of 25.08, profit margin of 40.25%, and ROE of 13.64%. The company generates $2.2B in annual revenue with strong year-over-year growth of 18.92%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 85.4/100 based on profitability, valuation, growth, and balance sheet metrics. The B+ grade reflects solid fundamentals with room for improvement in valuation or growth.
Fundamental Health Score
We analyze TW's fundamental strength across five key dimensions:
Efficiency Score
ExcellentTW demonstrates superior asset utilization.
Valuation Score
ModerateTW shows balanced valuation metrics.
Growth Score
ExcellentTW delivers strong and consistent growth momentum.
Financial Health Score
ExcellentTW maintains a strong and stable balance sheet.
Profitability Score
ModerateTW maintains healthy but balanced margins.
Key Financial Metrics
Is TW Expensive or Cheap?
P/E Ratio
TW trades at 25.08 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, TW's PEG of 0.38 indicates potential undervaluation.
Price to Book
The market values Tradeweb Markets Inc. at 3.29 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 15.70 times EBITDA. This signals the market has high growth expectations.
How Well Does TW Make Money?
Net Profit Margin
For every $100 in sales, Tradeweb Markets Inc. keeps $40.25 as profit after all expenses.
Operating Margin
Core operations generate 42.97 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $13.64 in profit for every $100 of shareholder equity.
ROA
Tradeweb Markets Inc. generates $10.48 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Tradeweb Markets Inc. generates strong operating cash flow of $1.21B, reflecting robust business health.
Free Cash Flow
Tradeweb Markets Inc. generates strong free cash flow of $1.15B, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $5.39 in free cash annually.
FCF Yield
TW converts 5.24% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
25.08
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
0.38
vs 25 benchmark
P/B Ratio
Price to book value ratio
3.29
vs 25 benchmark
P/S Ratio
Price to sales ratio
10.12
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.02
vs 25 benchmark
Current Ratio
Current assets to current liabilities
3.64
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.14
vs 25 benchmark
ROA
Return on assets percentage
0.10
vs 25 benchmark
ROCE
Return on capital employed
0.12
vs 25 benchmark
How TW Stacks Against Its Sector Peers
| Metric | TW Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 25.08 | 19.38 | Worse (Expensive) |
| ROE | 13.64% | 804.00% | Weak |
| Net Margin | 40.25% | -7623.00% (disorted) | Strong |
| Debt/Equity | 0.02 | 1.07 | Strong (Low Leverage) |
| Current Ratio | 3.64 | 609.22 | Strong Liquidity |
| ROA | 10.48% | -20946.00% (disorted) | Strong |
TW outperforms its industry in 4 out of 6 key metrics, particularly excelling in Net Margin, but lagging in P/E Ratio.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Tradeweb Markets Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
94.55%
Industry Style: Value, Dividend, Cyclical
High GrowthEPS CAGR
313.56%
Industry Style: Value, Dividend, Cyclical
High GrowthFCF CAGR
122.91%
Industry Style: Value, Dividend, Cyclical
High Growth