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Why Hold Strategy is Apt for Intercontinental (ICE) Stock
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Intercontinental Exchange’s (ICE - Free Report) compelling portfolio, broad range of risk management services, strategic buyouts, solid balance sheet and effective capital deployment, along with growth in estimates, make it worth retaining in one’s portfolio.
This leading global operator of regulated exchanges, clearing houses and listings venues, and a provider of data services for commodity, financial, fixed income and equity markets surpassed estimates in each of the last four reported quarters, with the average being 3.42%.
Zacks Rank & Price Performance
Intercontinental Exchange currently carries a Zacks Rank #3 (Hold). The stock has gained 0.6% against the industry’s decrease of 0.3% in the past month.
Image Source: Zacks Investment Research
Growth Projections
The Zacks Consensus Estimate for 2021 earnings is pegged at $5.02, indicating year-over-year increase of 11.3% on 15.3% higher revenues of $7 billion. The consensus estimate for 2022 earnings is pegged at $5.31, implying a year-over-year increase of 5.9% on 4.4% higher revenues of $7.3 billion. The expected long-term earnings growth rate is pegged at 8.4%, better than the industry average of 5.8%.
Return on Equity
The company’s return on equity or ROE for the trailing 12 months is 13.5%, comparing favorably with the industry’s 11.6%. This reflects the company’s efficiency in utilizing shareholders’ funds.
Business Tailwinds
Intercontinental Exchange’s revenues should continue to exhibit increasing trend given solid product and service suite along with strategic acquisitions. It estimates second-quarter 2021 revenues between $844 and $859 million. Exchange segment revenues are estimated between $315 million and $320 million in the second quarter of 2021.
Its Data service revenues should continue to benefit from strength in pricing and analytics. Also, with over 5,000 indices representing more than $1 trillion in benchmark assets under management, the company boasts being the second-largest fixed income provider globally.
Management estimates recurring revenues in Fixed Income and Data Services segment to grow 5% to 6% on a constant currency basis in 2021, including $401 million to $406 million in the second quarter of 2021.
The company is well poised to capitalize on the accelerated digitization taking place in the U.S. residential mortgage industry. It has the largest mortgage network across the United States. The integration of Ellie Mae into ICE Mortgage Technology is likely to help the company in boosting its mortgage business. Thus, management estimates revenues in the second quarter of 2021 to be between $128 million and $133 million, up 30% year over year.
Strong Capital Position
Intercontinental Exchange boasts a strong balance sheet. It hiked its dividend at a five-year CAGR of 10.5%. It also It plans to invest $25 million to $30 million in 2021 to enhance its Mortgage Technology platforms.
OTC Markets delivered an earnings surprise of 46.15% in the last-reported quarter.
Cincinnati Financial delivered an earnings surprise of 30.48% in the last-reported quarter.
HCI Group delivered an earnings surprise of 28.33% in the last-reported quarter.
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
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Why Hold Strategy is Apt for Intercontinental (ICE) Stock
Intercontinental Exchange’s (ICE - Free Report) compelling portfolio, broad range of risk management services, strategic buyouts, solid balance sheet and effective capital deployment, along with growth in estimates, make it worth retaining in one’s portfolio.
This leading global operator of regulated exchanges, clearing houses and listings venues, and a provider of data services for commodity, financial, fixed income and equity markets surpassed estimates in each of the last four reported quarters, with the average being 3.42%.
Zacks Rank & Price Performance
Intercontinental Exchange currently carries a Zacks Rank #3 (Hold). The stock has gained 0.6% against the industry’s decrease of 0.3% in the past month.
Growth Projections
The Zacks Consensus Estimate for 2021 earnings is pegged at $5.02, indicating year-over-year increase of 11.3% on 15.3% higher revenues of $7 billion. The consensus estimate for 2022 earnings is pegged at $5.31, implying a year-over-year increase of 5.9% on 4.4% higher revenues of $7.3 billion. The expected long-term earnings growth rate is pegged at 8.4%, better than the industry average of 5.8%.
Return on Equity
The company’s return on equity or ROE for the trailing 12 months is 13.5%, comparing favorably with the industry’s 11.6%. This reflects the company’s efficiency in utilizing shareholders’ funds.
Business Tailwinds
Intercontinental Exchange’s revenues should continue to exhibit increasing trend given solid product and service suite along with strategic acquisitions. It estimates second-quarter 2021 revenues between $844 and $859 million. Exchange segment revenues are estimated between $315 million and $320 million in the second quarter of 2021.
Its Data service revenues should continue to benefit from strength in pricing and analytics. Also, with over 5,000 indices representing more than $1 trillion in benchmark assets under management, the company boasts being the second-largest fixed income provider globally.
Management estimates recurring revenues in Fixed Income and Data Services segment to grow 5% to 6% on a constant currency basis in 2021, including $401 million to $406 million in the second quarter of 2021.
The company is well poised to capitalize on the accelerated digitization taking place in the U.S. residential mortgage industry. It has the largest mortgage network across the United States. The integration of Ellie Mae into ICE Mortgage Technology is likely to help the company in boosting its mortgage business. Thus, management estimates revenues in the second quarter of 2021 to be between $128 million and $133 million, up 30% year over year.
Strong Capital Position
Intercontinental Exchange boasts a strong balance sheet. It hiked its dividend at a five-year CAGR of 10.5%. It also It plans to invest $25 million to $30 million in 2021 to enhance its Mortgage Technology platforms.
Stocks to Consider
Some better ranked stocks from the finance sector are OTC Markets Group Inc. (OTCM - Free Report) , Cincinnati Financial Corporation (CINF - Free Report) and HCI Group (HCI - Free Report) , each carrying Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
OTC Markets delivered an earnings surprise of 46.15% in the last-reported quarter.
Cincinnati Financial delivered an earnings surprise of 30.48% in the last-reported quarter.
HCI Group delivered an earnings surprise of 28.33% in the last-reported quarter.
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
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