Interactive Brokers (IBKR) AI Stock Analysis

• Market Cap: $29.41B
• Dividend Yield: 0.43%
• Average Volume (3M): 4.60M
• Price to Earnings (P/E): 31.8
• Beta (1Y): 1.38
• Revenue Growth: 11.88%
• EPS Growth: 28.96%
• Country: US
• Employees: 3,027
• Sector: Financial
• Sector Strength: 70
• Industry: Investment - Banking & Investment Services
• EPS (TTM): 0.57
• Shares Outstanding: 445,363,700
• 10 Day Avg. Volume: 4,381,763
• 30 Day Avg. Volume: 4,600,623
• PEG Ratio: 1.13
• Price to Book (P/B): 4.46
• Price to Sales (P/S): 2.05
• P/FCF Ratio: 2.20
• Enterprise Value/Market Cap: -0.66
• Enterprise Value/Revenue: -1.95
• Enterprise Value/Gross Profit: -2.19
• Enterprise Value/Ebitda: -2.29
• 1Y Price Target: $80.38
• Price Target Upside: 21.73% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 8
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 80 Outperform
• Price Target: $82.00 ▲(24.19% Upside)

Interactive Brokers' strong financial performance and positive earnings call sentiment are the most significant factors driving the high score. The company's robust growth in client accounts and trading volumes, along with strategic product expansions, support a positive outlook. However, the high P/E ratio and low dividend yield suggest valuation concerns, and the high leverage requires careful monitoring.

Positive Factors

Revenue Growth

Strong revenue growth through increased commissions and trading volumes indicates robust market demand and effective business operations, supporting long-term financial stability.

Product Expansion

Expanding product offerings in international markets enhances competitive positioning and diversifies revenue streams, contributing to sustainable growth.

Cash Generation

Strong cash generation relative to earnings indicates efficient operations and provides financial flexibility for future investments and debt management.

Negative Factors

High Leverage

High leverage increases financial risk, particularly in a rising interest rate environment, potentially impacting long-term financial stability.

Challenges in China

Regulatory challenges in China may limit growth opportunities in a significant market, affecting future account acquisition and revenue potential.

Decline in Futures Volumes

A decline in futures volumes reflects potential market saturation or competitive pressures, which could impact revenue from this segment.

Interactive Brokers Business Overview & Revenue Model

Company Description

Interactive Brokers Group, Inc. operates as an automated electronic broker in the United States and internationally. The company engages in the execution, clearance, and settlement of trades in stocks, options, futures, foreign exchange instruments, bonds, mutual funds, exchange traded funds (ETFs), precious metals, and cryptocurrencies. It also offers custody and service accounts for hedge and mutual funds, ETFs, registered investment advisors, proprietary trading groups, introducing brokers, and individual investors. In addition, the company provides custody, prime brokerage, securities, and margin lending services. It serves institutional and individual customers through electronic exchanges and market centers. Interactive Brokers Group, Inc. was founded in 1977 and is headquartered in Greenwich, Connecticut.

How the Company Makes Money

Interactive Brokers generates revenue through several key streams, primarily focusing on commissions and fees from trading activities. The company charges clients a small commission for each trade executed on its platform, which varies based on the type of security and the client's trading volume. Additionally, IBKR earns interest income from its clients' margin loans, utilizing the funds that clients borrow to trade on margin. The company's revenue model also includes custodial fees and payment for order flow, where it receives compensation for directing orders to specific market makers. Significant partnerships with financial institutions and market makers further enhance IBKR's revenue potential, allowing the company to leverage its technology and trading volume to optimize earnings.

Interactive Brokers Financial Statement Overview

Summary

Interactive Brokers demonstrates strong financial health with robust revenue and cash flow growth, supported by high profitability margins. While the company effectively uses equity to generate returns, its high leverage poses potential risks. Overall, the financial statements reflect a well-managed company with strong cash generation capabilities, though vigilance on debt levels is advised.

Income Statement

Interactive Brokers shows strong revenue growth with a 4.1% increase in TTM, supported by high gross and EBIT margins of 80.6% and 75.5% respectively. The net profit margin is solid at 9.2%, indicating efficient cost management. However, the slight decline in gross profit margin from previous years suggests rising costs or competitive pressures.

Balance Sheet

The company's balance sheet reflects high leverage with a debt-to-equity ratio of 5.30, which could pose risks if interest rates rise. However, the return on equity is strong at 19.6%, indicating effective use of equity to generate profits. The equity ratio is relatively low, suggesting a reliance on debt financing.

Cash Flow

Cash flow performance is robust with a 5.9% growth in free cash flow and a high operating cash flow to net income ratio of 1514.3, indicating strong cash generation relative to earnings. The free cash flow to net income ratio is nearly 1, showing efficient conversion of income to cash.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	9.99B	9.32B	7.79B	4.19B	2.94B	2.42B
Gross Profit	8.89B	8.29B	6.87B	3.41B	2.31B	1.80B
EBITDA	8.48B	7.99B	6.60B	3.11B	2.09B	1.59B
Net Income	917.00M	755.00M	600.00M	380.00M	308.00M	195.00M
Balance Sheet
Total Assets	200.22B	150.14B	128.25B	115.14B	109.11B	95.68B
Cash, Cash Equivalents and Short-Term Investments	5.13B	3.63B	3.75B	3.44B	2.40B	4.29B
Total Debt	904.00M	16.26B	11.36B	8.96B	11.80B	9.96B
Total Liabilities	180.74B	133.54B	114.18B	103.53B	98.89B	86.68B
Stockholders Equity	5.11B	4.28B	3.58B	2.85B	2.40B	1.95B
Cash Flow
Free Cash Flow	15.98B	8.68B	4.50B	3.90B	5.82B	8.02B
Operating Cash Flow	16.04B	8.72B	4.54B	3.97B	5.90B	8.07B
Investing Cash Flow	-94.00M	-44.00M	-52.00M	-67.00M	-188.00M	-50.00M
Financing Cash Flow	-972.00M	-833.00M	-624.00M	-470.00M	-523.00M	-229.00M

Interactive Brokers Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 66.03
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IBKR, the sentiment is Neutral. The current price of 66.03 is below the 20-day moving average (MA) of 69.18, below the 50-day MA of 67.67, and above the 200-day MA of 56.42, indicating a neutral trend. The MACD of 0.36 indicates Positive momentum. The RSI at 42.38 is Neutral, neither overbought nor oversold. The STOCH value of 37.78 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for IBKR.

Interactive Brokers Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
IBKR	80 Outperform	$29.41B	31.81	19.82%	0.43%	11.88%	28.96%
MS	76 Outperform	$260.42B	16.82	15.15%	2.35%	7.22%	48.18%
GS	71 Outperform	$237.22B	16.06	13.57%	1.64%	2.31%	44.49%
SCHW	70 Outperform	$167.73B	22.14	17.05%	1.14%	5.90%	66.60%
LPLA	70 Outperform	$29.66B	34.11	21.32%	0.32%	35.19%	-18.62%
TW	68 Neutral	$25.90B	37.40	10.51%	0.44%	22.17%	40.13%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%

Interactive Brokers Corporate Events

Interactive Brokers Reports Strong Growth Amid Challenges

Interactive Brokers Group’s recent earnings call painted a picture of robust growth and strategic expansion, despite facing some regional challenges. The overall sentiment was positive, driven by significant increases in client equity, revenue, and trading volumes, alongside successful product expansions. While there were hurdles in China and a decline in futures volumes, the company’s strong financial performance and strategic moves in the crypto and global markets suggest a promising outlook.

Interactive Brokers Reports Strong Q3 2025 Earnings

Interactive Brokers Group, Inc. is a global electronic brokerage firm that provides automated trade execution and custody of securities, commodities, and foreign exchange across more than 160 markets worldwide. The company is renowned for its advanced technology platform and competitive pricing.