What Happened?
Shares of electronic trading platform Tradeweb Markets (NASDAQ: TW) fell 3.8% in the afternoon session after Morgan Stanley lowered its price target on the stock to $125 from $149. Despite the significant 16% reduction in the price target, the investment firm, led by analyst Michael Cyprys, maintained its "Equal-Weight" rating on the shares. The adjustment was part of a broader update of price targets for companies in the Brokers & Exchanges North America sector. The negative sentiment surrounding Tradeweb also coincided with wider market weakness, as U.S. stocks declined following the failure of lawmakers to reach a funding deal, which triggered a government shutdown and clouded the economic outlook for investors.
The shares closed the day at $107.56, down 3.1% from previous close.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy Tradeweb Markets? Access our full analysis report here, it’s free.
What Is The Market Telling Us
Tradeweb Markets’s shares are not very volatile and have only had 4 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
The previous big move we wrote about was 26 days ago when the stock dropped 3.5% on the news that the company released its August trading volume report, which showed mixed performance across different asset classes. While total average daily volume (ADV) for August rose 11.3% year-over-year to $2.5 trillion, investors appeared to focus on areas of weakness within the report. Specifically, U.S. government bond ADV, a key segment, declined by 3.9% year-over-year to $219.2 billion. Furthermore, credit derivatives ADV experienced a significant drop of 37.1% to $11.7 billion daily. The report also noted a 7% decrease in European ETF volume. This mixed performance, particularly the downturn in important markets, likely overshadowed the headline growth and raised concerns among investors about the platform's activity levels.
Tradeweb Markets is down 18.1% since the beginning of the year, and at $107.60 per share, it is trading 27.8% below its 52-week high of $149.02 from April 2025. Investors who bought $1,000 worth of Tradeweb Markets’s shares 5 years ago would now be looking at an investment worth $1,831.
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