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Intercontinental Exchange, Inc. (ICE - Free Report) reported first-quarter 2019 adjusted earnings per share of 92 cents, beating the Zacks Consensus Estimate of 89 cents by 3.4%. Also, the bottom line improved 2.2% on a year-over-year basis.
On a GAAP basis, net income was 85 cents per share, up 8% year over year.
The company witnessed growth in subscription-based Data & Listings business, which offset muted trading activity.
Intercontinental Exchange Inc. Price, Consensus and EPS Surprise
Intercontinental Exchange’s revenues of $1.270 billion increased 4% year over year on higher revenues at transaction and clearing (3%), data services (5%), listings segments (27%) and other revenues (20.8%). Moreover, the top line outpaced the Zacks Consensus Estimate of $1.269 billion.
Total operating expenses rose 5.2% year over year to $605 million, primarily due to higher compensation and professional services. Adjusted operating expenses were $528 million in the first quarter, up nearly 6.9% from the year-ago quarter’s figure.
Adjusted operating income improved 1.5% year over year to $742 million. Adjusted operating margin was 58%, down 200 basis points from the year-ago quarter.
Trading and Clearing's adjusted operating income of $408 million grew 0.7% year over year while adjusted operating margin contracted 100 basis points. Data and Listings' adjusted operating income rose 2.5% year over year to $334 million while adjusted operating margin of 51% contracted 100 basis points.
Financial Update
As of Mar 31, 2019, Intercontinental Exchange had cash and cash equivalents of $1.5 billion, down 1.4% from the level as of Dec 31, 2018. Long-term debt of $6.5 billion was up 0.03% from 2018-end level.
Total equity was $17.1 billion as of Mar 31, 2019, up 0.6% from $16.9 billion as of Dec 31, 2018.
Operating cash flow was $654 million, up 14% year over year. Free cash flow was $624 million, up 18% year over year.
Share Repurchase and Dividend Update
In the quarter, the company bought back shares worth $440 million and paid dividends amounting to $157 million.
Second-Quarter 2019 Guidance
Data revenues are estimated between $550 million and $555 million.
Operating expenses are projected in the range of $615-$625 million. Adjusted operating expenses are expected to be in the range of $537 million to $547 million.
The company expects interest expense of $71 million in the period.
Weighted average shares outstanding are anticipated between 563 million and 569 million shares.
2019 Outlook
Operating expenses are predicted in the band of $2.46-$2.49 billion. Adjusted operating expenses are expected to be in the range of $2.15 million to $2.18 million.
Other players from the same industry that have already reported first-quarter results include Nasdaq, Inc. (NDAQ - Free Report) , CME Group Inc. (CME - Free Report) and MarketAxess Holdings Inc. (MKTX - Free Report) . All the three companies beat the respective Zacks Consensus Estimate for earnings.
Zacks' Top 10 Stocks for 2019
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-holds for the year?
Who wouldn't? Our annual Top 10s have beaten the market with amazing regularity. In 2018, while the market dropped -5.2%, the portfolio scored well into double-digits overall with individual stocks rising as high as +61.5%. And from 2012-2017, while the market boomed +126.3, Zacks' Top 10s reached an even more sensational +181.9%.
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Intercontinental Exchange (ICE) Q1 Earnings & Revenues Beat
Intercontinental Exchange, Inc. (ICE - Free Report) reported first-quarter 2019 adjusted earnings per share of 92 cents, beating the Zacks Consensus Estimate of 89 cents by 3.4%. Also, the bottom line improved 2.2% on a year-over-year basis.
On a GAAP basis, net income was 85 cents per share, up 8% year over year.
The company witnessed growth in subscription-based Data & Listings business, which offset muted trading activity.
Intercontinental Exchange Inc. Price, Consensus and EPS Surprise
Intercontinental Exchange Inc. Price, Consensus and EPS Surprise | Intercontinental Exchange Inc. Quote
Performance in Detail
Intercontinental Exchange’s revenues of $1.270 billion increased 4% year over year on higher revenues at transaction and clearing (3%), data services (5%), listings segments (27%) and other revenues (20.8%). Moreover, the top line outpaced the Zacks Consensus Estimate of $1.269 billion.
Total operating expenses rose 5.2% year over year to $605 million, primarily due to higher compensation and professional services. Adjusted operating expenses were $528 million in the first quarter, up nearly 6.9% from the year-ago quarter’s figure.
Adjusted operating income improved 1.5% year over year to $742 million. Adjusted operating margin was 58%, down 200 basis points from the year-ago quarter.
Trading and Clearing's adjusted operating income of $408 million grew 0.7% year over year while adjusted operating margin contracted 100 basis points. Data and Listings' adjusted operating income rose 2.5% year over year to $334 million while adjusted operating margin of 51% contracted 100 basis points.
Financial Update
As of Mar 31, 2019, Intercontinental Exchange had cash and cash equivalents of $1.5 billion, down 1.4% from the level as of Dec 31, 2018. Long-term debt of $6.5 billion was up 0.03% from 2018-end level.
Total equity was $17.1 billion as of Mar 31, 2019, up 0.6% from $16.9 billion as of Dec 31, 2018.
Operating cash flow was $654 million, up 14% year over year. Free cash flow was $624 million, up 18% year over year.
Share Repurchase and Dividend Update
In the quarter, the company bought back shares worth $440 million and paid dividends amounting to $157 million.
Second-Quarter 2019 Guidance
Data revenues are estimated between $550 million and $555 million.
Operating expenses are projected in the range of $615-$625 million. Adjusted operating expenses are expected to be in the range of $537 million to $547 million.
The company expects interest expense of $71 million in the period.
Weighted average shares outstanding are anticipated between 563 million and 569 million shares.
2019 Outlook
Operating expenses are predicted in the band of $2.46-$2.49 billion. Adjusted operating expenses are expected to be in the range of $2.15 million to $2.18 million.
Zacks Rank
Intercontinental Exchange currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Securities and Exchanges
Other players from the same industry that have already reported first-quarter results include Nasdaq, Inc. (NDAQ - Free Report) , CME Group Inc. (CME - Free Report) and MarketAxess Holdings Inc. (MKTX - Free Report) . All the three companies beat the respective Zacks Consensus Estimate for earnings.
Zacks' Top 10 Stocks for 2019
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-holds for the year?
Who wouldn't? Our annual Top 10s have beaten the market with amazing regularity. In 2018, while the market dropped -5.2%, the portfolio scored well into double-digits overall with individual stocks rising as high as +61.5%. And from 2012-2017, while the market boomed +126.3, Zacks' Top 10s reached an even more sensational +181.9%.
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