Intercontinental Exchange (NYSE: ICE) is slated to present its fiscal Q4 2023 results on Thursday, February 8, 2024. Endeavoring to surpass the revenue and earnings consensus estimates appears to be within grasp for Intercontinental Exchange. In the preceding quarter, the exchange’s revenues fell short of expectations, whereas its earnings outperformed predictions. It recorded net revenues of $2 billion, an 11% surge compared to the previous year. This surge was largely driven by diminished transaction-related expenses, coupled with amplified fixed income & data services and mortgage technology revenues. An increase in year-on-year net revenues is anticipated for Q4. For further details, our interactive dashboard analysis on Intercontinental Exchange’s Earnings Preview provides more comprehensive insights.
Observing Stock Movement
Against the ongoing financial backdrop, the ICE stock has experienced marginal fluctuations, shifting from approximately $115 in early January 2021 to around $125 now. This reflects a 30% increase for the S&P 500 over this period of approximately 3 years. The stock’s performance in relation to the index has been rather lackluster. Its returns were 19% in 2021, -25% in 2022, and 25% in 2023. In comparison, the returns for the S&P 500 stood at 27% in 2021, -19% in 2022, and 24% in 2023. This indicates that ICE underperformed the S&P in 2021 and 2022, a feat that has been arduous for individual stocks in the Financials sector and even for heavyweight stocks such as V, JPM, MA, GOOG, TSLA, and MSFT over the past few years. In contrast, the Trefis High Quality (HQ) Portfolio, comprising 30 stocks, has outperformed the S&P 500 annually throughout the same period. Why is that? As a whole, stocks in the HQ Portfolio delivered superior returns with less risk compared to the benchmark index, evident in the HQ Portfolio’s performance metrics. Given the current uncertain macroeconomic environment characterized by soaring oil prices and elevated interest rates, could ICE face a situation akin to 2021 and 2022, potentially underperforming the S&P over the next 12 months – or will it experience a significant upturn?
Estimates and Predictions
Our projection denotes that Intercontinental Exchange’s valuation stands at $140 per share, representing an 11% increase over the prevailing market price of $127.
| Returns | Feb 2024 MTD [1] |
Since start of 2023 [1] |
2017-24 Total [2] |
| ICE Return | 0% | 24% | 125% |
| S&P 500 Return | 2% | 29% | 121% |
| Trefis Reinforced Value Portfolio | 0% | 38% | 608% |
[1] Returns on 2/6/2024
[2] Cumulative total returns since the end of 2016
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
