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Intercontinental Exchange Inc ICE

Morningstar Rating
$136.34 +0.94 (0.69%)
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Company Report

Intercontinental Exchange Earnings: Strong Energy Futures Revenue Drives Solid Results

Wide-moat-rated Intercontinental Exchange reported strong first-quarter results that were in line with our expectations as it benefited from continued strength in energy futures trading. Net revenue increased 21%, or 5% pro forma for the acquisition of Black Knight, to $2.3 billion. Diluted earnings per share increased 14% to $1.33. As we incorporate these results, we do not plan to materially alter our $140 fair value estimate. We see the shares as modestly undervalued at the current price.

Price vs Fair Value

ICE is trading within a range we consider fairly valued.
Price
$136.34
Fair Value
$528.00
Uncertainty
Medium
1-Star Price
$111.00
5-Star Price
$55.00
Economic Moat
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Capital Allocation
Lnzzcttr

Bulls Say, Bears Say

Bulls

Intercontinental Exchange has become increasingly less reliant on transactional revenue as it expands its data and service offerings both organically and through acquisitions.

Bears

ICE's mortgage technology segment is facing major headwinds that will not resolve until mortgage rates decline.

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News

Trading Information

Previous Close Price
$135.40
Day Range
$135.71136.55
52-Week Range
$103.81140.43
Bid/Ask
$135.71 / $136.78
Market Cap
$78.20 Bil
Volume/Avg
926,069 / 2.3 Mil

Key Statistics

Price/Earnings (Normalized)
23.76
Price/Sales
7.52
Dividend Yield (Trailing)
1.26%
Dividend Yield (Forward)
1.33%
Total Yield
1.39%

Company Profile

Intercontinental Exchange is a vertically integrated operator of financial exchanges and provides ancillary data products. Though the company is probably best known for its ownership of the New York Stock Exchange, which it acquired in 2013, ICE operates a large derivatives exchange, too. The company's largest commodity futures product is the ICE Brent crude futures contract. In addition to the exchanges business, which is about 56% of net revenue, Intercontinental Exchange has used a series of acquisitions to create its mortgage technology business (15% of net revenue) and fixed-income and data services segment (29% of net revenue).
Sector
Financial Services
Industry
Financial Data & Stock Exchanges
Stock Style Box
Large Core
Total Number of Employees
13,226

Competitors

Valuation

Metric
ICE
CME
NDAQ
Price/Earnings (Normalized)
23.7622.5122.54
Price/Book Value
2.962.813.33
Price/Sales
7.5213.565.33
Price/Cash Flow
18.2221.3019.74
Price/Earnings
ICE
CME
NDAQ

Financial Strength

Metric
ICE
CME
NDAQ
Quick Ratio
0.050.020.17
Current Ratio
1.001.011.01
Interest Coverage
4.1926.785.73
Quick Ratio
ICE
CME
NDAQ

Profitability

Metric
ICE
CME
NDAQ
Return on Assets (Normalized)
2.34%2.40%5.48%
Return on Equity (Normalized)
13.01%12.34%18.04%
Return on Invested Capital (Normalized)
8.16%11.37%9.28%
Return on Assets
ICE
CME
NDAQ
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LDNXF
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MSCI
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NDAQ
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FDS
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