Ever wondered if Nasdaq’s stock is truly worth its current price, or if there is untapped value beneath the surface?
While the share price has edged up 0.7% over the past week, it has also seen a 13.2% gain year-to-date, indicating signs of growth potential.
Recently, Nasdaq’s stock has attracted investor attention following notable tech partnerships and major financial market developments. These events have provided new energy and context to recent price movements, leading to speculation about future developments.
Currently, Nasdaq scores just 1 out of 6 on our valuation checks, so examining how different approaches assess its value may be helpful. There is also a more insightful way to consider valuation, which will be revealed by the end of this article.
Nasdaq scores just 1/6 on our valuation checks. See what other red flags we found in the full valuation breakdown.
The Excess Returns Model estimates a company’s value by calculating how much profit it generates above its cost of equity on invested capital. Essentially, it measures the effectiveness with which Nasdaq can grow shareholder wealth beyond what investors could expect from an average investment of similar risk.
For Nasdaq, the model considers a Book Value of $20.99 per share and a Stable EPS of $4.09 per share. These values are derived from forward-looking analyst estimates of return on equity. The company’s Cost of Equity stands at $1.97 per share, while the calculated Excess Return is $2.12 per share. Nasdaq’s average Return on Equity is an impressive 17.65%. A stable Book Value is projected to reach $23.15 per share in coming years, according to analyst consensus.
Applying the Excess Returns methodology, Nasdaq’s estimated intrinsic value works out to $63.52 per share. Compared to the current share price, this represents a 38.0% premium, indicating that the stock is considerably overvalued based on this approach.
Result: OVERVALUED
Our Excess Returns analysis suggests Nasdaq may be overvalued by 38.0%. Discover 918 undervalued stocks or create your own screener to find better value opportunities.
NDAQ Discounted Cash Flow as at Nov 2025
Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Nasdaq.
The Price-to-Earnings (PE) ratio is widely regarded as a reliable valuation metric for profitable companies because it allows investors to see how much they are paying for each dollar of earnings. For companies like Nasdaq, which generate consistent profits, the PE ratio provides a straightforward way to compare value against other similar businesses.
Growth expectations and risk play a big part in determining what a “normal” or “fair” PE ratio should be. Firms with stronger expected earnings growth or lower risk often command higher PE multiples, while those with slower growth or greater uncertainty typically trade at lower levels.
Nasdaq currently trades at a PE ratio of 30.8x, which is just below the peer average of 31.9x and significantly higher than the Capital Markets industry average of 23.6x. However, using Simply Wall St’s proprietary “Fair Ratio” model, which accounts for Nasdaq’s growth prospects, profitability, industry, market cap, and unique risk profile, the fair PE ratio for Nasdaq is calculated at 16.0x. Unlike mere comparisons with peers and the broader industry, the Fair Ratio aims to provide a more nuanced view, reflecting the company’s true fundamentals and risk-adjusted outlook.
Since Nasdaq’s actual PE multiple is well above its Fair Ratio, this approach suggests the stock may be priced higher than its underlying performance warrants.
Result: OVERVALUED
NasdaqGS:NDAQ PE Ratio as at Nov 2025
PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover 1422 companies where insiders are betting big on explosive growth.
Earlier, we mentioned there is an even better way to understand valuation, so let’s introduce you to Narratives. A Narrative is a simple yet powerful approach that lets you apply your own story or perspective to a company, connecting your view about future revenue, earnings, and margins to a financial forecast and ultimately a fair value estimate.
Narratives help you link the reasons behind Nasdaq’s recent developments, such as new products, partnerships, or regulatory changes, directly to numbers and fair value. This means your investment decisions are not just about ratios but the company’s actual journey and what you believe will happen next.
This tool is accessible to everyone on Simply Wall St’s Community page, where millions of investors already create and track Narratives tailored to their conviction and research. Narratives automatically update as new earnings reports or news come out, making your view always up to date and allowing you to quickly see if the price still matches your expectations.
For example, the most optimistic Narrative values Nasdaq at $115.00, believing that international growth and tech expansion will drive substantial earnings, while a cautious Narrative pegs it at $74.00, expecting competitive pressure to keep margins and revenue under pressure. Both use the same data, but different stories and forecasts.
Do you think there’s more to the story for Nasdaq? Head over to our Community to see what others are saying!
NasdaqGS:NDAQ Community Fair Values as at Nov 2025
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.
Companies discussed in this article include NDAQ.
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