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Intercontinental Exchange (ICE) Q2 Earnings: What's Up?

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Intercontinental Exchange, Inc. (ICE - Free Report) is set to report second-quarter 2016 results on Aug 3, before the market opens. Last quarter, the company posted a positive earnings surprise of 0.27%. Let’s see how things are shaping up for this announcement.

Factors to be Considered this Quarter  

Intercontinental Exchange is likely to display a rise in revenues in the second quarter. Strong results at the trading and clearing as well as data and listing segments might have led to the improvement.

Further, the company might experience an increase in listings revenues, mainly due to clear leadership and capital raising activity at the NYSE over the last few years.

Revenue improvement coupled with disciplined expense management is expected to have benefited the bottom line.

However, Intercontinental Exchange is likely to witness a rise in operating and capital costs, owing to new product launches, higher debt and integration expenses as well as compensation and benefits expenses. Management estimates $495 million to $505 million in expenses in the second quarter.

With respect to surprise trend, the company delivered a positive earnings surprise in three of the last four quarters with an average beat of 3.40%.

INTERCONTNTLEXC Price and EPS Surprise

INTERCONTNTLEXC Price and EPS Surprise | INTERCONTNTLEXC Quote

Earnings Whispers

Our proven model does not conclusively show that Intercontinental Exchange is likely to beat on earnings this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here as you will see below.

Zacks ESP: Intercontinental Exchange has an Earnings ESP of -0.30%. This is because the Most Accurate estimate is pegged at $3.37, while the Zacks Consensus Estimate stands at $3.38.

Zacks Rank: Intercontinental Exchange carries a Zacks Rank #3 (Hold).

We caution against Sell-rated stocks (Zacks Rank #4 or 5) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

Stocks to Consider

Here are some companies from the finance sector that you may want to consider as these have the right combination of elements to post an earnings beat this quarter:

The Allstate Corporation (ALL - Free Report) has an Earnings ESP of +7.55% and a Zacks Rank #3. The company is set to report second-quarter earnings on Aug 3.

Bats Global Markets has an Earnings ESP of +3.23% and a Zacks Rank #2. The company is slated to report second-quarter earnings on Aug 4.

Manulife Financial Corporation (MFC - Free Report) has an Earnings ESP of +2.94% and a Zacks Rank #3. The company is expected to report second-quarter earnings on Aug 4.

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