Goldman Sachs says financial services firm Marex Group’s impressive growth rate could boost its outlook by more than 70%. The firm on Monday initiated coverage of Marex Group, a London-based global broker-dealer and commodity market maker, with a buy rating and a price target of $33 per share. Goldman’s forecast suggests an increase of about 73% from Friday’s closing price of $19.08 per share. Goldman highlighted Marex Group’s “solid” earnings clip, with the company posting a compound annual growth rate (CAGR) of more than 40% from 2020 to 2023. Approximately half of the growth was due to acquisitions, with the remainder coming from organic growth. Goldman analyst Alexander Brostein said the stock price is rising. MRX YTD Mountain Marex Group stock. He expects Marex Group’s revenue CAGR to be 12.3% from 2023 to 2026, and the profit CAGR to expand by 18% over the same period. Catalysts behind this growth include strong industry volumes and tailwinds for the futures commission merchant market. So-called FCMs include individuals and companies that solicit or accept trading orders for products for future delivery. Marex Group listed on the Nasdaq in late April at an initial price of $19 per share. The company’s stock price has languished since then, with Friday’s closing price up less than 0.5% from its public offering price. The company maintains a strong presence in Europe, where the majority of its customers are consumers, large and small banks, asset managers and hedge funds. “As one of the largest non-bank futures merchants (FCMs), MRX has benefited from growth in the futures market and a decline in the number of FCMs, creating a favorable supply and demand relationship for the company,” Blostein said. Ta. “Regulatory pressure on banks could create further constraints on the industry’s balance sheets, creating additional revenue opportunities for MRX.” The analyst also said the FCM industry is brimming with corporate investments and additions. In light of this, he raised the possibility of additional acquisitions, which would be a tailwind for the Marex Group. “MRX operates in a fragmented industry with many lower-tier competitors and a long history of successful acquisitions,” Brostein said. “We expect MRX to continue making acquisitions (targeting ROE of 20% or more) [return on equity] (for acquired companies), but our estimate does not include the transaction. ”
This little-known brokerage could rise more than 70%, according to Goldman
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