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Marex Group · MRX · NASDAQ

Marex is a London-based non-bank broker that clears, executes and hedges derivatives trades on 60-plus exchanges — earning commissions, market-making spreads and interest income on $13bn of client cash.

$56.51
Price
$4.1B
Market cap
$2.0B
Revenue (FY2025)
60+
Exchanges connected
IPO April 2024 at $19; closed at a fresh all-time high of $56.51 today after a 47% YTD rally — roughly 3× the listing price.
2 · The tension

Cheapest peer, highest ROE, fastest growth — sitting on top of an IPO-period class action

  • The cheapest with the best returns. MRX trades at 12.8× TTM diluted earnings versus StoneX (the closest business comp) at ~27× on current market cap, while earning 27.5% ROE against StoneX's 15.2% and growing revenue 27% vs. ~16% (SNEX net operating revenue).
  • The discount is forensic, not operational. The FY2025 20-F admits two unremediated material weaknesses — IT general controls and balance-sheet substantiation — with no committed deadline, and a consolidated SDNY class action targets the IPO-window market-making numbers.
  • The calendar resolves it inside twelve months. The August Q2 print, the May 21 Bermuda redomicile vote, and the SDNY motion-to-dismiss ruling each move the discount one way or the other.
The market debates whether Q1's trading windfall persists — but the multiple is gated on whether the IPO-period numbers survive discovery.
3 · The diversification test

Revenue grew 27% in a year NII collapsed 33% — the IPO promise, finally evidenced

$2.0B
Revenue FY2025 +27% YoY
27.5%
ROE FY2025 up from 24.9%
$852M
Net trading income +73% YoY
−$75M
Net interest income −33% YoY on Fed cuts

Net interest collapsed as the Fed cut roughly 100bps; trading income added $360M and commissions another $121M, and ROE still climbed. The four-engine model absorbed the rate hit — first live test of the IPO diversification claim, and it cleared. Q1 2026 doubled down with revenue +48%, but management labelled the trading line 'extreme volatility we do not expect to persist' — the first explicit normalisation caveat in eight quarters as a public company.

4 · The forensic overhang

Two material weaknesses, seven plaintiff firms, and a class action targeting the IPO numbers themselves

  • The controls are still broken. Management itself concluded at FY2025 year-end that IT general controls and balance-sheet substantiation/reconciliation remain ineffective — no committed remediation date. Receivables grew 45.5% in FY2025 against 26.9% revenue growth, an 18.6pp gap inside the exact population flagged.
  • The class action targets the IPO window. Seven firms — Robbins, Berger Montague, Glancy Prongay, Kessler Topaz and others — allege off-book intercompany trades inflated Market Making revenue across May 16, 2024 to Aug 5, 2025. Lead-plaintiff phase closed Dec 2025; motion-to-dismiss ruling pending in SDNY.
  • The discount may be mis-allocated. Plaintiffs target Market Making — 12% of revenue, 17% of Adjusted PBT. Clearing, the 49.5%-margin float engine and BBB- credit story, is not in the population at risk, yet the multiple gap is priced as a whole-franchise overhang.
Credit investors with full diligence access priced April 2026's senior notes (5.680% 2031) ~70bps tighter than the prior 6.404% 2029 issue — they did not require a forensic premium.
5 · The next 90 days

Three binary events on a stock at all-time highs

  • May 21 — Bermuda redomicile vote. Court and General meetings; clean approval unlocks 10% buyback authority and a likely effective-tax-rate step-down for H2 2026 implementation. A failed vote or an unsuccessful consent solicitation on the 2029 notes (deadline May 15) creates two-to-three quarters of process drag.
  • Early August — Q2 earnings. The decisive test. Q1's $1.48 Adjusted Diluted EPS annualises to $5.92 against consensus FY26 of $4.81 — consensus has already discounted Q1 by 25%. A Q2 print at the FY25 quarterly run-rate ($1.10-1.20) lifts implied FY26 EPS toward $5.10-5.40 and would compress the SNEX-multiple gap.
  • Later in 2026 — SDNY motion-to-dismiss ruling. Pleadings-stage dismissal would narrow the forensic discount toward parity with StoneX. Survival opens discovery into the Luxembourg 'Marex Fund' SICAV-RAIF and the intercompany populations the short-seller named in August 2025.
6 · Bull & Bear

Lean watchlist — the bull math is real, but the August print resolves it cheaply

  • For. Cheapest peer at 12.8× TTM earnings on 27.5% ROE, while average clearing client balances compounded from $11bn (FY24) to $13bn (FY25) to $16bn (Q1 26) through a Fed rate-cut year — switching-cost evidence, not a bond proxy.
  • For. Comp/revenue has held at 61% through 27% revenue growth and four bolt-on integrations. A 200bps bend lower adds ~$40m to pre-tax — operating leverage independent of the trading-income debate.
  • Against. Q1 trading income was +109% YoY and management itself flagged the windfall as not persistent. A revert toward the FY2024 run-rate evaporates ~$360m of revenue against a fixed 61% comp ratio — a multi-hundred-bp pre-tax hit.
  • Against. Two unremediated material weaknesses in their second year sit inside the exact balance-sheet population the class action targets — and the period at risk is the IPO numbers themselves.
My view — wait for August. A clean Q2 with Adjusted PBT margin holding above 21% and the Bermuda vote behind us would flip this to long. A miss with the comp ratio rising above 63% would lock the discount in.

Watchlist to re-rate: Q2 2026 Adjusted PBT margin (must hold above 21%); comp/revenue ratio (below 61.5% on a Webb Traders-consolidated base); SDNY motion-to-dismiss ruling; remediation of either material weakness in the FY2026 audit close.