Analysis from Stocktrendz: stocktrendz.com
Knight Trimark Group is the leading Market Maker in securities listed on the NYSE, NASDAQ, and AMEX markets. As a percentage of volume, NITE controls 17% of its market. They are also the largest destination for on line orders.
NITE has only recently come public. It began trading in July of 1998, just as the general markets were topping. The stock suffered with the market, but investors have realized the value of the company and bid its share price up in recent months to an all-time high of 60$ per share.
With the world of online trading booming, NITE stands to benefit greatly with its position as the leading market maker. Chances are NITE has helped execute an order you've placed at one time or another. Due to recent upgrades, the company believes it will soon be able to handle a million orders a day.
From the 10K:
The company's target customers are national and regional full-service broker-dealers, on-line discount brokers and institutional investors. A number of NITE's customers own shares of Class A common stock and Class B common stock.
Some of the company's customers include:
Ameritrade Inc. Merrill Lynch, Pierce,
BHC Securities, Inc. Fenner & Smith
BHF Securities Corp. Incorporated Mesirow Financial
Bidwell & Company Nathan & Lewis Securities, Corporation Inc.
Brown & Company Securities Burke, Christensen & Lewis National Discount Brokers
Securities, Inc. National Financial Services
CIBC Wood Gundy Securities Corporation Corp. PaineWebber Incorporated
Cowles, Sabol & Co., Inc. Primevest Financial
Dain Rauscher Incorporated Services, Inc. The R.J. Forbes Group, Inc
David A. Noyes & Co. Sanders Morris Mundy, Inc.
Direct Access Brokerage Services, Inc. Scottsdale Securities, Inc.
Discover Brokerage Direct, Southwest Securities, Inc.
.
E*TRADE Securities, Inc. Thomas F. White & Co.
A.G. Edwards & Sons, Inc. U.S. Clearing Corp.
Fiserv Correspondent Van Kasper & Company
Services, Inc. Waterhouse Securities, Inc.
Howe Barnes Investments, Inc. Wedbush Morgan Securities,
International Correspondent Inc.
Trading, Inc.
J.W. Charles Securities, Inc.
Josephthal & Co. Inc.
Stockcross, Inc
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In addition, NITE has over 500 institutional customers, including mutual funds, investment advisors, pension plan sponsors, bank trusts, foundations and endowments.
In 1998, NITE's five largest customers, Ameritrade, Brown & Company, Discover Brokerage Direct, E*TRADE Securities and Waterhouse Securities, accounted for 33.0% of their order flow. In 1998, one customer, Waterhouse Securities, accounted for 10.7% of the Company's order flow.
The company's revenues for the past years are as follows:
Revenues Quarter 1996 1997 1998 1999
March 39,312 50,978 63,532 182,664
June 54,219 50,093 80,546 224,047
September 38,539 58,572 92,375 n/a
December 53,106 67,024 119,280 n/a
Total 185,176 226,667 355,733 406,711
Units in thousands of dollars
Revenues have been expanding rapidly, increasing 57% last year. With increased capacity, these numbers should continue higher at more rapid rates. Earnings have risen strongly as well:
Earnings Per Share Quarter 1996 1997 1998 1999
March 0.060 0.070 0.100 0.335
June 0.085 0.060 0.135 0.430
September 0.035 0.090 0.125 n/a
December 0.065 0.090 0.165 n/a
Total 0.245 0.310 0.525 0.765
Units in Dollar Denominations
Fundamentally speaking, the company is in a very strong position. NITE has $266 million in cash and a Profit Margin at 19.13%.
Margins are high at 19% and there are only 105 million shares outstanding. The company's float is less than half that at 48 million shares because of high inside ownership (35%). Return on Equity is 64.40.
Cash flow provided by operating activities has been steadily rising from 28 million in 1996 to $85.3 million in 1999. This is good because the company won't have to borrow cash to provide for ongoing operations.
The company's earnings per share rank is 99, relative strength is 99, and group strength is 96. Shares have an accumulation rank of A and earnings are expected to rise 61% in the next year.
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