Analysts at Goldman Sachs upped their forecasts for Euronext this week, claiming the stock exchange operator sands to benefit from MiFID II restrictions on dark pools.

Chris Turner, a London-based equity analyst at Goldman, boosted his rating on Euronext shares to a ‘buy’ and added the pan-European exchange to his ‘conviction list’.

Part of positive outlook is down to incoming rules on dark pools, also known as unlit order books, where institutional investor orders are anonymous before and during execution.

The EU’s MiFID II legislation is set to have a considerable impact on dark pool trading, imposing caps to limit trades, except for those that qualify for the large-in-scale waiver.

As a result, more trades will be forced onto lit markets, like Euronext - one of Europe’s largest cash equity exchanges.

The group, which operates of stock markets in countries including France and the Netherlands, withdrew from the competition to build a European not-for-profit dark pool last year.

Although the firm does have its own unlit trading venue, dubbed SmartPool.

“Euronext remains a beneficiary of market volatility - 60% of revenues are sensitive to trading volumes - and also stands to benefit from MiFID II restrictions on unlit order books," Turner said in a note on Wednesday.

"We raise our earnings forecasts from 2018 onwards to reflect this,” he added.

Further delays to MiFID II, which has already been put back a year to 2018 by the European Commission, are a downside risk to Euronext, the Goldman analyst reckons.

Meanwhile a favourable ruling in a Dutch court recently over capital requirements should also open the door to value creation via M&A.

Stéphane Boujnah took charge of Euronext at the end of last year after Dominique Cerutti stood down in May.

Euronext’s shares have declined 12% since the new management disclosed plans to use previously announced cost savings to fund greater investment in the group.

Goldman’s house view is that while focus has been on the adverse impact of the investment plan, little attention has been placed on the potential for the increased spending to drive higher earnings growth over the medium term.

“We see potential for this to be brought into focus when management details its strategic plan in May 2016,” Turner added.