Marex Group plc (MRX) AI Stock Analysis

• Market Cap: $2.63B
• Dividend Yield: 0.73%
• Average Volume (3M): 681.48K
• Price to Earnings (P/E): 12.7
• Beta (1Y): 0.67
• Revenue Growth: N/A
• EPS Growth: N/A
• Country: US
• Employees: 2,425
• Sector: General
• Sector Strength: N/A
• Industry: Financial - Capital Markets
• EPS (TTM): 0.76
• Shares Outstanding: 70,290,886
• 10 Day Avg. Volume: 1,081,094
• 30 Day Avg. Volume: 681,483
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 22763.10
• Price to Cash Flow (P/CF): N/A
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $43.00
• Price Target Upside: 11.95% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 7

Marex Group plc achieves a solid overall score due to strong financial performance, particularly in revenue growth and balance sheet strength. The technical analysis indicates robust upward momentum, providing confidence in future performance. However, cash flow concerns need to be addressed to ensure long-term liquidity. Valuation metrics suggest the stock is fairly priced, with a reasonable P/E ratio and a modest dividend yield. The absence of recent earnings call data and corporate events means the score largely reflects existing financial and market indicators.

Positive Factors

Client Balances

Client balances increased significantly to $15.5B from $13.8B in the previous quarter and $10.9B in the same quarter last year.

Revenue Growth

MRX reported 4Q24 total revenue of $416M, which grew +20% year-over-year and +6% quarter-over-quarter.

Negative Factors

Acquisition Activity

MRX has not announced any new acquisitions since the Hamilton Court announcement, attributed to a tougher deal-making backdrop.

Stock Valuation

The stock has experienced a robust rally, with a 64% increase in 2024 and 16% YTD, but there is limited room for further upward re-rating.

Marex Group plc Business Overview & Revenue Model

Company Description

Marex is a diversified global financial services platform providing essential liquidity, market access and infrastructure services to clients across energy, commodities and financial markets. We provide critical services to our clients by connecting them to global exchanges and providing a range of execution services. We provide connectivity to 58 exchanges, including as a Category 1 member of the London Metal Exchange (LME) and a top 5 participant by volume on each of the Chicago Mercantile Exchange (CME) and the Intercontinental Exchange (ICE). We have a diverse client base of more than 4,000 active clients as of December 31, 2023. This includes both traditional consumers and producers of commodities who have recurring demand for our services across a variety of market conditions and financial clients, such as banks and asset managers.

How the Company Makes Money

Marex Group makes money through several key revenue streams. Primarily, the company generates income from trading and market-making activities in commodities and financial markets, where it earns spreads on buy and sell transactions. Marex also earns fees from providing clearing and execution services for its clients, including hedge funds, asset managers, and other institutional investors. Additionally, the company offers risk management and hedging solutions, which contribute to its revenue by providing tailored financial products to help clients manage their market exposure. Strategic partnerships and collaborations with exchanges and other financial institutions also play a role in enhancing Marex's service offerings and expanding its market reach, thereby contributing to its earnings.

Marex Group plc Financial Statement Overview

Summary

Marex Group plc exhibits strong revenue growth and improved profitability, reflecting a robust income statement performance with high margins. The balance sheet shows enhanced equity strength and a favorable debt-to-equity ratio, but high liabilities pose a potential risk. Cash flow challenges, particularly in operating cash flow, highlight potential liquidity issues that require attention.

Income Statement

Marex Group plc demonstrates strong revenue growth with a significant increase from $1.01B in 2022 to $2.36B in 2024. The company's gross profit margin remains high at 100% due to the equivalent gross profit and total revenue figures, indicating efficient cost management. The net profit margin improved to 9.25% in 2024 from 6.80% in 2023, showcasing enhanced profitability. The EBIT margin also reflects significant improvement, highlighting effective operational management. However, the absence of EBITDA data for 2024 limits the comprehensive assessment of operational performance.

Balance Sheet

The balance sheet reflects a solid financial position with increasing stockholders' equity, reaching $976.9M in 2024. The debt-to-equity ratio improved substantially, indicating a stronger equity position relative to debt. The equity ratio improved to 4.02% in 2024 from 3.69% in 2023, suggesting enhanced financial stability. However, the company operates with a high level of total liabilities relative to assets, which could pose potential risks if not managed carefully.

Cash Flow

Cash flow analysis reveals a significant decline in operating cash flow from $735M in 2023 to zero in 2024, raising concerns about cash generation capabilities. Free cash flow has also dropped to zero in 2024, indicating potential challenges in funding operations and investments internally. The absence of cash flow data for EBITDA and operating activities in 2024 further limits the ability to fully assess cash flow health.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
2.36B	1.88B	1.01B	825.30M	757.53M
	Gross Profit
2.36B	564.60M	1.01B	825.30M	757.53M
	EBIT
1.39B	204.30M	102.60M	68.60M	36.42M
	EBITDA
863.40M	705.40M	284.30M	107.70M	18.56M
	Net Income Common Stockholders
218.00M	128.00M	91.60M	56.50M	43.82M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
2.56B	6.06B	910.10M	712.00M	291.55M
	Total Assets
24.31B	17.75B	15.74B	5.26B	3.77B
	Total Debt
6.14B	3.17B	472.10M	136.60M	246.76M
	Net Debt
3.58B	1.69B	-438.00M	-575.40M	-44.79M
	Total Liabilities
23.34B	16.97B	15.07B	136.60M	3.32B
	Stockholders Equity
976.90M	775.90M	677.70M	477.70M	443.79M
Cash Flow		Free Cash Flow
1.14B	722.90M	216.20M	463.50M	-49.14M
	Operating Cash Flow
1.16B	735.00M	225.60M	470.80M	-45.78M
	Investing Cash Flow
-35.30M	-97.60M	-46.30M	-19.80M	-31.05M
	Financing Cash Flow
-37.20M	-72.80M	26.50M	-27.20M	150.88M

Marex Group plc Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 38.41
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MRX, the sentiment is Positive. The current price of 38.41 is above the 20-day moving average (MA) of 37.08, above the 50-day MA of 35.90, and above the 200-day MA of 28.98, indicating a bullish trend. The MACD of 0.96 indicates Negative momentum. The RSI at 58.62 is Neutral, neither overbought nor oversold. The STOCH value of 51.37 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for MRX.

Marex Group plc Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MRX	78 Outperform	$2.63B	12.66	16.50%	0.73%	―	―
BGC	72 Outperform	$4.16B	34.06	14.24%	0.93%	11.73%	242.82%
MC	71 Outperform	$3.94B	28.93	34.27%	4.77%	39.75%	―
SNEX	70 Outperform	$3.94B	14.70	16.40%	―	60.57%	17.39%
PIPR	69 Neutral	$4.01B	22.05	15.66%	1.13%	12.29%	99.57%
AMRK	68 Neutral	$566.96M	11.96	8.22%	3.32%	4.95%	-54.69%
Sector *	55 Neutral	$3.85B	-10.06	-15.05%	5.28%	17.38%	-45.34%