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Intercontinental Exchange Inc. (ICE)
NYSE:ICE
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Intercontinental Exchange
(NYSE:ICE)
79Outperform
Positive Factors
Digitization and Industry Penetration
ICE's ability and commitment to digitize the mortgage industry and penetrate the $14b TAM.
Earnings and Price Target
The price target for Intercontinental Exchange Inc has been raised to $178.
Platform Connectivity
ICE's platform has connectivity to ~85% of US mortgages which offers opportunities for cross-sell in a $14b TAM.
Negative Factors
Earnings Achievability
The focus is on the achievability of earnings per share after the Black Knight deal closure.
Limitations in Analysis
Investors should consider Morgan Stanley Research as only a single factor in making their investment decisions, indicating potential limitations in the analysis.
Intercontinental Exchange (ICE) vs. S&P 500 (SPY)
Market Cap
$99.50B
Dividend Yield1.05%
Average Volume (3M)3.81M
Price to Earnings (P/E)36.3
Beta (1Y)0.74
Revenue Growth15.32%
EPS Growth14.02%
CountryUS
Employees12,842
SectorFinancial
Sector Strength88
IndustryFinancial - Data & Stock Exchanges
Share Statistics
EPS (TTM)4.78
Shares Outstanding573,626,300
10 Day Avg. Volume2,685,807
30 Day Avg. Volume3,810,347
Financial Highlights & Ratios
PEG Ratio2.59
Price to Book (P/B)N/A
Price to Sales (P/S)0.00
Price to Cash Flow (P/CF)0.00
P/FCF Ratio0.00
Enterprise Value/Market Cap1.05
Enterprise Value/RevenueN/A
Enterprise Value/Gross Profit15.98
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$189.85Price Target Upside9.46% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering14
Intercontinental Exchange Business Overview & Revenue Model
Company DescriptionIntercontinental Exchange, Inc., together with its subsidiaries, operates regulated exchanges, clearing houses, and listings venues for commodity, financial, fixed income, and equity markets in the United States, the United Kingdom, the European Union, Singapore, Israel, and Canada. It operates through three segments: Exchanges, Fixed Income and Data Services, and Mortgage Technology. The company operates marketplaces for listing, trading, and clearing an array of derivatives contracts and financial securities, such as commodities, interest rates, foreign exchange, and equities, as well as corporate and exchange-traded funds; trading venues, including 13 regulated exchanges and 6 clearing houses; and offers futures and options products for energy, agricultural and metals, financial, cash equities and equity, over-the-counter, and other markets, as well as listings and data and connectivity services. It also provides fixed income data and analytic, fixed income execution, CDS clearing, and other multi-asset class data and network services. In addition, the company offers proprietary and comprehensive mortgage origination platform, which serves residential mortgage loans; closing solutions that provides customers connectivity to the mortgage supply chain and facilitates the secure exchange of information; data and analytics services; and Data as a Service for lenders to access data and origination information. Intercontinental Exchange, Inc. was founded in 2000 and is headquartered in Atlanta, Georgia.
How the Company Makes MoneyIntercontinental Exchange generates revenue through several key streams: transaction and clearing fees from its trading platforms, data services subscriptions, and listing fees. Transaction fees are earned each time a trade is executed on its exchanges, while clearing fees are collected for processing and settling trades. ICE Data Services provides critical market data and analytics to financial institutions, which is monetized through subscription-based models. Additionally, ICE earns revenue from companies that pay to list their securities on its stock exchanges. Strategic partnerships and acquisitions further bolster ICE's offerings and market presence, enhancing its ability to generate income across its diversified business segments.
Intercontinental Exchange Financial Statement Overview
Summary
Intercontinental Exchange displays a strong financial position with impressive revenue growth, high profitability margins, and efficient cash flow management. While the balance sheet is solid, there is potential for enhancing equity proportions. The company is well-positioned in the financial industry, with a stable outlook and consistent financial performance.Income Statement
Intercontinental Exchange has demonstrated strong revenue growth, with a 23.3% increase from 2023 to TTM (Trailing-Twelve-Months). The company maintains robust profitability metrics, including a gross profit margin of 63.9% and a net profit margin of 23.1% for TTM. Additionally, the EBIT and EBITDA margins are solid at 37.2% and 47.4% respectively. This consistent growth and high profitability indicate a strong financial performance.85
Very Positive
Balance Sheet
The company's balance sheet shows a stable equity position, with a debt-to-equity ratio of 0.74 for TTM, which suggests moderate leverage. The return on equity (ROE) is strong at 9.95%, reflecting effective use of equity to generate profits. The equity ratio stands at 19.6%, indicating a solid capital structure, though there is room for improvement in equity proportions.78
Positive
Cash Flow
Intercontinental Exchange exhibits steady cash flow with a free cash flow to net income ratio of 1.42, indicating efficient cash conversion. The operating cash flow to net income ratio is 1.64, highlighting strong cash generation capabilities. While the free cash flow observed a decline of 5.8% from 2023 to TTM, the overall cash flow management remains robust.82
Very Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 11.76B | 9.90B | 9.64B | 9.17B | 8.24B | Gross Profit |
| 6.52B | 5.66B | 5.20B | 5.02B | 4.30B | EBIT |
| 4.31B | 3.69B | 2.52B | 6.22B | 3.03B | EBITDA |
| 5.95B | 4.90B | 4.80B | 5.82B | 3.87B | Net Income Common Stockholders |
| 2.75B | 2.37B | 1.45B | 4.06B | 2.09B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 1.37B | 2.11B | 1.80B | 607.00M | 583.00M | Total Assets |
| 139.43B | 136.08B | 194.34B | 193.50B | 126.20B | Total Debt |
| 20.70B | 22.91B | 18.38B | 14.17B | 16.86B | Net Debt |
| 19.86B | 22.01B | 16.58B | 13.56B | 16.27B | Total Liabilities |
| 111.71B | 110.30B | 171.58B | 170.75B | 106.57B | Stockholders Equity |
| 27.72B | 25.72B | 22.71B | 22.71B | 19.50B |
| Cash Flow | Free Cash Flow | |||
| 4.20B | 3.05B | 3.07B | 2.67B | 2.47B | Operating Cash Flow |
| 4.61B | 3.54B | 3.55B | 3.12B | 2.88B | Investing Cash Flow |
| -921.00M | -8.80B | 677.00M | -786.00M | -9.83B | Financing Cash Flow |
| 79.00M | -64.34B | -1.84B | 62.03B | 6.74B |
Intercontinental Exchange Technical Analysis
Positive
173.45
Price Trends
167.16
Positive
161.17
Positive
159.19
Positive
Market Momentum
0.91
Negative
66.58
Neutral
93.77
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ICE, the sentiment is Positive. The current price of 173.45 is above the 20-day moving average (MA) of 160.64, above the 50-day MA of 167.16, and above the 200-day MA of 159.19, indicating a bullish trend. The MACD of 0.91 indicates Negative momentum. The RSI at 66.58 is Neutral, neither overbought nor oversold. The STOCH value of 93.77 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ICE.
Intercontinental Exchange Risk Analysis
Intercontinental Exchange disclosed 38 risk factors in its most recent earnings report. Intercontinental Exchange reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Intercontinental Exchange Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $99.50B | 36.28 | 10.27% | 1.05% | 15.32% | 14.02% | |
79 Outperform | $101.06B | 28.20 | 13.40% | 3.74% | 11.72% | 13.31% | |
78 Outperform | $23.71B | 31.39 | 18.42% | 1.08% | 8.51% | 1.13% | |
77 Outperform | $44.88B | 35.45 | 11.43% | 1.23% | 25.89% | 16.37% | |
76 Outperform | $155.38B | 39.78 | 11.68% | 0.73% | 12.98% | 42.72% | |
71 Outperform | $174.38B | 12.68 | 13.88% | 3.08% | 6.57% | 55.54% | |
64 Neutral | $12.64B | 9.74 | 8.05% | 17044.60% | 12.66% | -4.62% |
* Financial Sector Average
Performance Comparison
ICE
Intercontinental Exchange
173.45
43.71
33.69%
CBOE
Cboe Global Markets
226.39
45.73
25.31%
CME
CME Group
280.45
81.65
41.07%
SPGI
S&P Global
506.62
84.03
19.88%
MS
Morgan Stanley
120.22
28.37
30.89%
NDAQ
Nasdaq
78.18
17.42
28.67%
Intercontinental Exchange Earnings Call Summary
Earnings Call Date:May 01, 2025
(Q1-2025)
| % Change Since: 3.26%|
Next Earnings Date:Jul 31, 2025
Earnings Call Sentiment Positive
The earnings call highlighted record performance across various segments, including energy and interest rate markets, and strong shareholder returns, despite challenges related to operating expenses and potential impacts in the mortgage segment.Q1-2025 Updates
Positive Updates
Record First Quarter Results
First quarter earnings per share of $1.72 were up 16% year-over-year, with net revenue increasing 8% to a record $2.5 billion. Adjusted operating income increased by 11% to reach a record $1.5 billion.
Strong Segment Performance
Exchange segment net revenues totaled a record $1.4 billion, up 12% year-over-year. Fixed Income and Data Services segment revenues totaled a record $596 million. Mortgage Technology results showed revenues of $510 million, with recurring revenues up year-over-year.
Significant Capital Return to Shareholders
The company returned $519 million of capital to shareholders during the quarter, including $241 million of share repurchases.
Record Energy Revenues
Record energy revenues, which grew 23% year-over-year, marked the eighth consecutive quarter of record performance in this segment.
Strong Growth in Interest Rate and Equity Markets
Interest rate business grew 18%, cash equities and options revenues grew 21%, and energy ADV was up 39%.
Negative Updates
Increased Operating Expenses
Second quarter operating expenses are expected to increase to $980 million to $990 million due to a weaker dollar and other factors.
Potential Impact from Flagstar and Rocket Cooper
The company acknowledged potential risks related to Rocket's business strategy and Flagstar's contribution, although no immediate impact on 2025 guidance.
Uncertain Mortgage Market Environment
Concerns regarding the consumer and delays in bank implementations could impact the mortgage segment, despite maintaining guidance.
Company Guidance
During the ICE First Quarter 2025 Earnings Call, the company reported record-breaking results, with earnings per share reaching $1.72, a 16% increase year-over-year. Net revenue rose by 8% to $2.5 billion, and adjusted operating income increased by 11% to $1.5 billion. ICE's Exchange segment achieved a record $1.4 billion in net revenues, driven by a 16% growth in transaction revenues, including an 18% increase in interest rate business and a 23% rise in energy revenues. The Fixed Income and Data Services segment also performed well, with revenues totaling $596 million, while the Mortgage Technology segment reported $510 million in revenues. Looking ahead to the second quarter, ICE expects adjusted operating expenses to range between $980 million and $990 million and non-operating expenses between $175 million and $180 million.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.