Even though Nasdaq (currently trading at $92.05 per share) has gained 7.7% over the last six months, it has lagged the S&P 500’s 12.7% return during that period. This may have investors wondering how to approach the situation.
Find out in our full research report, it’s free.
Why Do Investors Watch Nasdaq?
Originally founded in 1971 as the world's first electronic stock market, Nasdaq (NASDAQ: NDAQ) operates global exchanges and provides technology, data, and corporate services that help companies, investors, and financial institutions navigate capital markets.
Three Positive Attributes:
1. Long-Term Revenue Growth Shows Strong Momentum
Examining a company’s long-term performance can provide clues about its quality. Any business can put up a good quarter or two, but the best consistently grow over the long haul.
Thankfully, Nasdaq’s 11.9% annualized revenue growth over the last five years was solid. Its growth surpassed the average financials company and shows its offerings resonate with customers.
2. EPS Moving Up Steadily
Analyzing the long-term change in earnings per share (EPS) shows whether a company’s incremental sales were profitable — for example, revenue could be inflated through excessive spending on advertising and promotions.
Nasdaq’s decent 10.7% annual EPS growth over the last five years aligns with its revenue performance. This tells us it maintained its per-share profitability as it expanded.
3. Market-Beating ROE Showcases Attractive Growth Opportunities
Return on equity, or ROE, tells us how much profit a company generates for each dollar of shareholder equity, a key funding source for financial firms. Over a long period, financial firms with high ROE tend to compound shareholder wealth faster through retained earnings, buybacks, and dividends.
Over the last five years, Nasdaq has averaged an ROE of 15.4%, healthy for a company operating in a sector where the average shakes out around 10% and those putting up 25%+ are greatly admired. This shows Nasdaq has a decent competitive moat.
Final Judgment
There are definitely things to like about Nasdaq. With its shares trailing the market in recent months, the stock trades at 21.5× forward P/E (or $92.05 per share). Is now the time to initiate a position? See for yourself in our full research report, it’s free.
Stocks We Like Even More Than Nasdaq
ALSO WORTH WATCHING: Top 5 Momentum Stocks. The best time to own a great stock is when the market is finally noticing it. These aren’t just high-quality businesses. Something is happening with them right now. Elite fundamentals meet near-term momentum — both boxes checked at the same time.
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Stocks that have made our list include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+1,154% between June 2020 and June 2025). Find your next big winner with StockStory today.
