FOR PROFESSIONAL RESEARCH WRITER ONLY

160 120 100 80 60 50 40 30

20 15

Percent shares traded

45 30 15

Target Price Range 2023 2024 2025

NASDAQ, INC. NDQ-NDAQ 125.37 21.8 22.415.0 1.04 1.6% TIMELINESS 2 Raised 10/9/20 SAFETY 3 Lowered 10/9/20 TECHNICAL 3 Lowered 6/12/20 BETA 1.05 (1.00 = Market)

18-Month Target Price Range Low-High Midpoint (% to Mid)

$86-$200 $143 (15%)

2023-25 PROJECTIONS Ann’l Total

Price Gain Return High 145 (+15%) 5% Low 100 (-20%) -3% Institutional Decisions

4Q2019 1Q2020 2Q2020 to Buy 261 259 252 to Sell 224 246 257 Hld’s(000) 127107 124430 123286

High: 27.4 24.3 29.7 27.3 40.6 49.7 60.1 71.9 80.1 96.8 108.3 137.9 Low: 17.5 17.2 20.3 21.0 25.3 33.5 44.8 55.3 66.0 73.0 78.7 71.7

% TOT. RETURN 8/20 THIS VL ARITH.*

STOCK INDEX 1 yr. 37.2 8.7 3 yr. 89.0 17.6 5 yr. 188.8 45.6

CAPITAL STRUCTURE as of 6/30/20 Total Debt $3482 mill. Due in 5 Yrs $2975 mill. LT Debt $3482 mill. LT Interest $175 mill. (Tot. Int. Coverage: 10.1x) (38% of Cap’l)

Leases, Uncapitalized Annual rentals $77.0 mill. Pension Assets-12/19 $1486.8 mill.

Oblig. $797.5 mill. Pfd Stock None

Common Stock 164,258,414 shs. as of 7/28/20

MARKET CAP: $20.6 billion (Large Cap) CURRENT POSITION 2018 2019 6/30/20

($MILL.) Cash Assets D 854 653 947 Receivables 384 422 523 Inventory - - - - - - Other 5132 3215 3246 Current Assets 6370 4290 4716 Accts Payable 198 148 129 Debt Due 875 391 - - Other 5497 3688 4120 Current Liab. 6570 4227 4249

ANNUAL RATES Past Past Est’d ’17-’19 of change (per sh) 10 Yrs. 5 Yrs. to ’23-’25 Revenues 4.0% 5.0% 7.0% ‘‘Cash Flow’’ 10.0% 11.0% 6.0% Earnings 10.0% 11.5% 6.5% Dividends - - 27.5% 4.5% Book Value 5.5% - - 11.0%

Cal- Full endar Year

QUARTERLY REVENUES ($ mill.) Mar.31 Jun. 30 Sep. 30 Dec. 31

2017 971 1000 969 1025 3965 2018 1151 1027 964 1136 4277 2019 1039 1061 1096 1064 4262 2020 1353 1398 1185 1184 5120 2021 1360 1400 1315 1200 5275 Cal- Full

endar Year EARNINGS PER SHARE A

Mar.31 Jun. 30 Sep. 30 Dec. 31 2017 1.10 1.02 1.06 1.05 4.06 2018 1.24 1.18 1.15 1.26 4.84 2019 1.22 1.22 1.27 1.29 5.00 2020 1.50 1.54 1.35 1.36 5.75 2021 1.50 1.60 1.40 1.40 5.90 Cal- Full

endar Year QUARTERLY DIVIDENDS PAID E

Mar.31 Jun.30 Sep.30 Dec.31 2016 .25 .32 .32 .32 1.21 2017 .32 .38 .38 .38 1.46 2018 .38 .44 .44 .44 1.70 2019 .44 .47 .47 .47 1.85 2020 .47 .49 .49

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 6.84 10.58 14.76 17.55 18.07 16.13 18.19 19.81 18.83 18.96 20.74 20.71 22.24 23.68 .88 1.51 1.51 1.95 2.48 2.28 2.92 3.25 3.24 3.35 3.77 4.38 4.75 5.23

d.14 .57 .75 1.59 2.01 1.83 1.98 2.53 2.50 2.60 2.88 3.39 3.68 4.06 - - - - - - - - - - - - - - - - .39 .52 .58 .90 1.21 1.46

.33 .31 .19 .13 .27 .28 .24 .51 .53 .68 .83 .81 .80 .86

.33 1.90 12.98 15.90 21.01 23.31 26.84 28.67 31.45 36.51 34.32 34.13 32.60 35.16 78.97 83.15 112.32 138.87 201.90 211.39 175.78 173.55 165.61 169.36 168.80 164.32 166.58 167.44

- - 36.1 45.9 22.1 16.4 11.2 10.1 9.9 9.6 12.5 14.0 15.3 17.8 17.8 - - 1.92 2.48 1.17 .99 .75 .64 .62 .61 .70 .74 .77 .93 .90 - - - - - - - - - - - - - - - - 1.6% 1.6% 1.4% 1.7% 1.9% 2.0%

3197.0 3438.0 3119.0 3211.0 3500.0 3403.0 3705.0 3965.0 25.3% 26.6% 26.9% 30.1% 32.4% 32.7% 33.2% 33.7% 103.0 109.0 104.0 122.0 137.0 138.0 170.0 188.0 411.0 455.0 432.0 445.0 499.0 581.0 621.0 688.0

32.7% 32.1% 33.6% 33.6% 33.6% 33.6% 33.7% 33.3% 12.9% 13.2% 13.9% 13.9% 14.3% 17.1% 16.8% 17.4% 279.0 543.0 565.0 363.0 420.0 340.0 478.0 267.0

2181.0 2072.0 1931.0 2589.0 2313.0 2364.0 3603.0 3727.0 4718.0 4976.0 5208.0 6184.0 5793.0 5609.0 5430.0 5887.0

6.7% 7.3% 6.7% 5.7% 6.9% 8.0% 7.6% 7.9% 8.7% 9.1% 8.3% 7.2% 8.6% 10.4% 11.4% 11.7% 8.7% 9.1% 7.0% 5.8% 6.9% 7.7% 7.8% 7.6%

- - - - 15% 20% 20% 26% 32% 35%

2018 2019 2020 2021 © VALUE LINE PUB. LLC 23-25 25.90 25.82 31.20 32.35 Revenues per sh 37.50 6.18 6.21 7.00 7.20 ‘‘Cash Flow’’ per sh 8.25 4.84 5.00 5.75 5.90 Earnings per sh A 6.80 1.70 1.85 1.94 2.02 Div’ds Decl’d per sh E 2.20 .67 .77 .75 .75 Cap’l Spending per sh .70

32.99 34.16 37.10 44.30 Book Value per sh C 64.00 165.17 165.09 164.00 163.00 Common Shs Outst’g B 160.00

18.0 19.0 Bold figures are Value Line estimates

Avg Ann’l P/E Ratio 18.0 .97 1.03 Relative P/E Ratio 1.00

1.9% 1.9% Avg Ann’l Div’d Yield 1.8%

4277.0 4262.0 5120 5275 Revenues ($mill) 6000 29.6% 30.7% 35.0% 35.0% Operating Margin 35.0% 210.0 190.0 200 215 Depreciation ($mill) 230 811.0 835.0 950 965 Net Profit ($mill) 1090

25.7% 26.0% 26.5% 26.0% Income Tax Rate 25.0% 19.0% 19.6% 18.6% 18.3% Net Profit Margin 18.2% d200.0 63.0 200 350 Working Cap’l ($mill) 900 2956.0 2996.0 3000 3000 Long-Term Debt ($mill) 3000 5449.0 5639.0 6085 7220 Shr. Equity ($mill) 10240 10.5% 10.4% 10.5% 9.5% Return on Total Cap’l 8.0% 14.9% 14.8% 15.5% 13.5% Return on Shr. Equity 10.5% 9.7% 9.4% 10.5% 8.5% Retained to Com Eq 7.0% 35% 37% 33% 34% All Div’ds to Net Prof 32%

Company’s Financial Strength B++ Stock’s Price Stability 85 Price Growth Persistence 95 Earnings Predictability 100

(A) Diluted earnings. Excludes nonrecurring gains/(losses): ’04, 12¢; ’06, 20¢; ’07, $1.87; ’08, (43¢); ’09, (58¢); ’10, (7¢); ’13, (36¢), ’14, (49¢); ’15, (89¢). EPS may not sum due to

changes in share count. ’17 EPS does not sum due to restatement. Next earnings report due late October. (B) In millions. (C) Includes intangibles. In

2019: $8.615 bill., $52.18 a share. (D) Includes restricted cash. (E) Initiated quarterly dividend 6/29/12. Div’d hist. paid in late Mar., Jun., Sept., and Dec.

BUSINESS: Nasdaq, Inc. provides trading, clearing, exchange technologies, securities listing, and information services. As of 12/31/19, there were 3,140 securities listed on The NASDAQ Stock Market. It also operates other equities and options markets, a U.S. treasuries platform, and several global exchanges. Market Serv- ices, 36% of ’19 revenues; Corporate Services, 20%; Information

Services, 31%; and Market Technology, 13%. Acq. OMX AB 2/08. Has 4,361 employees. Off./dir. own .6% of stock; Borse Dubai, 18.1%, Investor AB, 11.8%; Massachusetts Financial Services, 8.4%; Vanguard, 7.8% (4/20 proxy). Chair/Pres./CEO.: Adena T. Friedman. Inc.: DE. Address: 151 W. 42nd Street, New York, NY 10036. Tel.: 212-401-8700. Internet: www.nasdaq.com.

Nasdaq put in a stellar performance for the June period. Share earnings were up 26%, on a 32% revenue advance during the second quarter. Indeed, reve- nues from Market Services (which account for 40% of the top line) jumped 22% year to year, likely spurred by increased trad- ing volume. Likewise, it has been strengthening its nontrading segments. The exchange operator is poised to do well in the near term. Ongoing restruc- turing measures and business improve- ments (discussed below) should help Nas- daq withstand headwinds from COVID-19 and ensuing economic uncertainty. That said, volatile market conditions will proba- bly boost trading action, which could add lift to its sails in the coming months. And this should offset the negative impact of a low interest-rate environment on its fixed- income assets. All told, share net ought to advance 15%, on a 20% revenue gain this year. Plus, the top and bottom lines will probably climb at a low single-digit clip through 2021. Strategic business investments should better position the company for the long haul. Following the integration of

recent Solovis and eVestment acquisitions, Nasdaq has been overhauling its business. Ongoing restructuring, expense controls, and efficiency improvements ought to bol- ster results in the near future. Plus, it may seek partnerships or tuck-in acquisi- tions to widen its geographic or market footprint. Meanwhile, it ought to focus on technological enhancements to bolster its products and services. Such moves should help it adapt to the new business back- drop, as well as better serve its clients. Nasdaq has been shoring up its finances. Earlier this year, the company focused on increasing cash reserves and reducing its near-term debt. During the second quarter, the company issued a $500 million, 30-year bond to pay down its com- mercial paper and other borrowings. The financial flexibility ought help it finance the aforementioned growth efforts. These shares are favorably ranked for year-ahead relative price perform- ance. The issue is already trading within our projected 2023-2025 Target Price Range, thereby limiting much of its long- term capital appreciation potential. Orly Seidman October 9, 2020

LEGENDS 15.0 x ″Cash Flow″ p sh

. . . . Relative Price Strength Options: Yes Shaded area indicates recession

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