TMX Group (X:CA)

On Monday July 29th, National Bank Financial (Analyst Rank#21) issued a research report, updating the research firm’s coverage on the stock, and raised its 12 month target price forecast for TMX Group Limited to $43 from $40, while maintaining a “Sector Perform” rating.

Analyst Forecast and Stock Performance

According to the latest forecast from eight analysts, the average target price for TMX Group Limited over the next 12 months is CAD 39.42. The average analyst rating is Hold, indicating a neutral sentiment towards the stock. Stock Target Advisor’s analysis is very bullish, with 19 positive fundamental signals and no negative signals. As of the last closing, TMX Group Limited’s stock price was CAD 42.00, demonstrating notable growth.

Recent Stock Price Movement

TMX Group Limited’s stock price has shown significant positive movement recently. Over the past week, the price increased by 1.45%. Over the past month, it grew by 10.29%, and over the last year, the stock saw a remarkable rise of 40.09%.

Positive Signals

1. Low Debt: TMX Group is less leveraged compared to its peers, placing it in the top quartile for financial flexibility. This low leverage enhances the company’s stability and ability to manage financial challenges.
2. Underpriced on Cash Flow Basis: The stock is trading low compared to its peers on a price-to-cash flow basis, indicating it might be undervalued.
3. Low Volatility: The stock’s annual returns have been stable and consistent, making it a lower-risk investment compared to its sector peers.
4. Superior Risk-Adjusted Returns: TMX Group has performed well on a risk-adjusted basis compared to its sector peers, indicating efficient risk management.
5. Underpriced Compared to Book Value: The stock is trading low compared to its peers on a price-to-book value basis, suggesting potential undervaluation.
6. Positive Cash Flow and Free Cash Flow: TMX Group has generated positive total and free cash flow in the most recent four quarters, highlighting strong financial health.
7. Superior Return on Assets and Capital Utilization: The company has delivered better return on assets and invested capital in the most recent four quarters compared to its peers.
8. Superior Total Returns: The stock has outperformed its sector peers on average annual total returns basis in the past five years.
9. Underpriced on Free Cash Flow Basis: The stock is trading low compared to its peers on a price-to-free cash flow basis, indicating potential undervaluation.
10. High Market Capitalization: TMX Group is one of the largest entities in its sector, contributing to its stability.
11. Superior Revenue and Earnings Growth: The company has shown top quartile revenue and earnings growth in the previous five years.
12. Underpriced Compared to Earnings: The stock is trading low compared to its peers on a price-to-earnings basis, suggesting it may be undervalued.
13. High Gross Profit to Asset Ratio: TMX Group has a high gross profit to asset ratio compared to its peers.
14. Superior Dividend Growth and High Dividend Returns: The company has shown top quartile dividend growth and has outperformed its peers on average annual dividend returns.
15. Superior Return on Equity: The company has delivered better return on equity in the most recent four quarters compared to its peers.

Negative Signals:

No negative signals to mention.

Outlook

National Bank Financial’s updated target and Sector Perform rating for TMX Group Limited reflect a strong position in the market. The company’s robust financial health, consistent performance, and positive growth indicators make it an attractive investment. While the average analyst rating remains “Hold”, the very bullish sentiment from Stock Target Advisor and the numerous positive signals suggest potential for continued success.