A Top-level Insider at Nasdaq Inc Just Bought $510K Worth of Stock

If a CEO is investing hundreds of thousands in their own company, it’s often worth taking a closer look. CEOs tend to be way ahead of analysts and portfolio managers when it comes to the performance of their companies and their stock purchases can provide valuable trading signals.

In this report, we are going to highlight a large CEO stock purchase at Nasdaq Inc (NDAQ:US). Nasdaq is an American financial services company that owns and operates a number of stock exchanges in the US and Europe. It also offers data and analytics services. It’s listed on the Nasdaq Global Select Market and currently has a market cap of around $25.0 billion.

Large CEO Purchase

Our data shows that on July 31, Nasdaq’s Chairman and CEO Adena Friedman bought 10,000 shares at a price of $51.00 per share. This trade cost the insider $510,000 and increased her holding to 1.67 million shares.

Top-level Insider

Ms. Friedman is likely to have a good understanding of her company’s prospects. She has served as CEO since 2017 and before this, she was COO, where she was responsible for overseeing all of the company’s business segments with a focus on driving efficiency, product development, growth, and expansion. She is credited with transforming Nasdaq into a leading global exchange and technology solutions company with operations across six continents. What stands out here is the size of Ms. Friedman’s purchase. Our records show that it is the largest insider stock purchase at Nasdaq for over a decade.

It's worth noting that Mr. Friedman is not the only insider to buy stock here recently. On August 3, Board member Jeffery Yabuki also purchased shares. He picked up 500 shares at a price of $49.4 per share.

Solid Results

Nasdaq recently produced a solid set of Q2 results, thanks to robust demand for its investment and capital markets solutions.

For the quarter, revenue came in at $925 million, up 4.0% year on year and ahead of the consensus forecast of $915 million. Meanwhile, earnings per share came in at 71 cents versus the forecast of 66 cents.

A highlight of the quarter was growth in the company’s anti-financial crime revenues. Revenues here rose 19% year on year as large financial institutions accelerated their adoption of Nasdaq’s Verafin’s fraud detection and anti-money laundering solutions.

“Our solid financial performance in the second quarter reflects the durability and recurring nature of our business and the resilient demand for our diversified set of client solutions,” commented CFO Ann Dennison.

“Our consistent cash flow generation makes Nasdaq well positioned to execute our deleveraging plan while making focused, organic investments that advance our strategy, while executing our dividend growth and share repurchase strategies,” she added.

In light of these results, and the fact that the stock is currently trading near 52-week lows, we see the insider buying as a bullish development.