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Tradeweb Markets (NASDAQ:TW) Shareholders Booked A 19% Gain In The Last Year

Diversification is a key tool for dealing with stock price volatility. Of course, in an ideal world, all your stocks would beat the market. Tradeweb Markets Inc. (NASDAQ:TW) has done well over the last year, with the stock price up 19% beating the market return of 16% (not including dividends). Tradeweb Markets hasn't been listed for long, so it's still not clear if it is a long term winner.

See our latest analysis for Tradeweb Markets

To quote Buffett, 'Ships will sail around the world but the Flat Earth Society will flourish. There will continue to be wide discrepancies between price and value in the marketplace...' One way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS).

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During the last year Tradeweb Markets grew its earnings per share (EPS) by 45%. It's fair to say that the share price gain of 19% did not keep pace with the EPS growth. Therefore, it seems the market isn't as excited about Tradeweb Markets as it was before. This could be an opportunity. Of course, with a P/E ratio of 59.92, the market remains optimistic.

The company's earnings per share (over time) is depicted in the image below (click to see the exact numbers).

earnings-per-share-growth
earnings-per-share-growth

We know that Tradeweb Markets has improved its bottom line lately, but is it going to grow revenue? This free report showing analyst revenue forecasts should help you figure out if the EPS growth can be sustained.

A Different Perspective

With a TSR of 19% over the last year, Tradeweb Markets shareholders would be reasonably content, given that's not far from the broader market return of 18%. However, the share price has actually dropped 7.9% over the last three months. This could simply be a short term fluctuation, though. Even the biggest winners have their down periods. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. For example, we've discovered 2 warning signs for Tradeweb Markets that you should be aware of before investing here.

Of course Tradeweb Markets may not be the best stock to buy. So you may wish to see this free collection of growth stocks.

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US exchanges.

This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com.