CMC Markets (LON:CMCX) has received a significant vote of confidence in the latest research note from Panmure Liberum, with the broker upgrading its rating from Hold to Buy and raising its price target from 380p to 700p.
The note, written by Research Analyst Barun Singh, points to a clear step-change in CMC Markets’ earnings outlook after the company materially upgraded its FY2027 net operating income guidance. CMC Markets is now guiding to £550 million, compared with previous guidance of £460 million to £480 million. That is at least £70 million above the top end of the earlier range, giving investors a much stronger view of the company’s near-term earnings potential.
Panmure Liberum’s upgrade is not based on a single moving part. Instead, the research note highlights a combination of stronger B2B momentum, product development, operating leverage and disciplined cost control. The result is a more attractive earnings profile, with a greater proportion of additional revenue expected to flow through to profit.
Research Analyst Barun Singh captures the scale of the change clearly, writing: “This is not a modest beat; it is a structural re-rating of the earnings trajectory”.
That sentence sits at the heart of the note. Panmure Liberum is not simply saying CMC Markets has delivered a better-than-expected update. It is arguing that the company’s business model is now showing stronger structural earnings power, particularly as its B2B platform business scales.
The broker’s new FY2027 forecasts show net operating income rising to £550.8 million, up 18.8% from its previous estimate. The upgrade is even more pronounced at the profit level, with EBITDA increased to £245.0 million, a 67.4% uplift from the prior forecast. Profit before tax is lifted to £220.7 million, up 75.9%, while basic EPS rises to 59.4p, also up 75.9%.
Key forecast highlights from Panmure Liberum include:
- FY2027 net operating income forecast upgraded to £550.8 million, up 18.8%.
- FY2027 EBITDA forecast upgraded to £245.0 million, up 67.4%.
- FY2027 profit before tax forecast upgraded to £220.7 million, up 75.9%.
- FY2027 basic EPS forecast upgraded to 59.4p, up 75.9%.
- FY2027 EBITDA margin forecast increased to 44.5%.
- FY2028 net operating income forecast upgraded to £608.0 million.
- FY2029 net operating income forecast upgraded to £674.7 million.
- FY2029 EBITDA forecast upgraded to £305.3 million.
- FY2029 EPS forecast increased to 76.8p.
One of the most important themes in the note is operational gearing. CMC Markets’ operating expenses, excluding variable remuneration, remain anchored at around £280 million. This matters because it means that the uplift in net operating income is not being matched by a similar rise in fixed costs. In simple terms, the company already has much of the platform, technology and compliance infrastructure in place, so new B2B revenue can carry attractive margins.
This is particularly relevant for a business like CMC Markets, where scale can make a meaningful difference. As more B2B partnerships go live or deepen over time, additional income has the potential to contribute disproportionately to EBITDA. Panmure Liberum’s revised numbers reflect that dynamic, with EBITDA margins expected to rise sharply from 31.6% to 44.5% in FY2027, before edging higher to 44.7% in FY2028 and 45.2% in FY2029.
The B2B opportunity is central to the investment case. Panmure Liberum describes the scale and momentum of CMC’s B2B platform business as the main driver of the upgrade. This part of the business benefits from a largely fixed cost base and can also lower customer acquisition costs compared with the direct-to-consumer model. That creates a more efficient route to revenue growth, particularly when partnerships are with established financial institutions that already have large customer bases.
Product depth is another factor behind the more positive stance. The research note points to the extension of trading hours, the addition of options and warrants, and the rollout of Spectre as examples of CMC Markets’ broader and more sophisticated platform offering. It also highlights the integration of a cash-equivalent wallet alongside trading assets within a single application. According to the note, this helps position CMC Markets as more than a trading venue, instead making it a broader financial infrastructure provider for end-users accessing products through B2B channels.
That broader product set could make the platform stickier for partners and customers. For B2B relationships, this matters because once a partner has embedded a platform across its digital channels or adviser networks, replacing it is not necessarily easy or quick. Panmure Liberum argues that this product depth creates a meaningful barrier to displacement once a partnership is established.
The Australian partnerships with Westpac and ASB are also highlighted as important medium-term drivers. Panmure Liberum notes that these relationships are not yet fully reflected in the current guidance upgrade. Both Westpac and ASB are large, established financial institutions with substantial retail client bases, giving CMC Markets a potentially valuable distribution advantage.
However, the research note is also careful on timing. It suggests that partnerships of this kind typically take time to ramp up as products are embedded across adviser networks and digital channels. As a result, the revenue contribution from Westpac and ASB is expected to become more meaningful towards the end of FY2027, with the full run-rate impact building progressively through FY2028.
That is important for investors because it suggests the FY2027 upgrade may not represent the full potential of the current partnership pipeline. Panmure Liberum states that investors should view current guidance as a floor that does not fully capture the Australian revenue potential. It also suggests that FY2028 consensus estimates may move higher as contributions from Westpac and ASB become more visible.
The valuation argument is also clear. Panmure Liberum says CMC Markets currently trades on around 5x CY2027 EV/EBITDA, which it believes materially undervalues the earnings power now visible in the business. The broker’s new 700p price target is based on 6.3x CY2027 EV/EBITDA, which it says still represents a discount to CMC’s closest peers, Plus500 and IG Group.
Importantly, Panmure Liberum does not present the re-rating case as dependent on one single event. Instead, it points to several potential drivers: continued delivery against the upgraded guidance, further progress in B2B partnerships, margin accretion flowing through to the bottom line, and greater market confidence in outer-year earnings as each reporting period removes execution risk.
The balance sheet and cash generation forecasts also support the positive tone of the note. Panmure Liberum forecasts net cash, including leases, of £290.4 million in FY2027, rising to £443.5 million in FY2028 and £622.2 million in FY2029. Forecast dividends are also expected to rise from 13.8p in FY2026 to 17.0p in FY2027 and 18.5p in FY2028.
The overall message from the latest research note from Panmure Liberum is that CMC Markets is entering a stronger phase of growth, supported by higher net operating income, a scalable B2B model, disciplined costs and improving margins. The broker’s move from Hold to Buy reflects a belief that the market has not yet fully recognised the earnings power now visible in the business.
Panmure Liberum’s upgraded forecasts mark a meaningful shift in the CMC Markets story. The company’s FY2027 guidance upgrade is supported by B2B momentum, product expansion and operational leverage, while the Westpac and ASB partnerships could provide further support into FY2028 and beyond. With the broker lifting its price target to 700p and highlighting a stronger earnings trajectory, CMC Markets now has a clearer and more compelling growth profile than before.
