ICE Shares Hit 52-Week High - Analyst Blog

On Dec 16, 2013, shares of IntercontinentalExchange Group, Inc . ( ICE ) hit a 52-week high of $222.39.

The momentum was driven by continued outperformance, enhanced guidance, and continuing efforts to grow.

IntercontinentalExchange's third quarter-quarter 2013 earnings of $1.97 per share modestly exceeded the Zacks Consensus Estimate by 7.6% and the year-ago quarter figure by 10%. Results reflected higher market data and other businesses that drove the top line.

Management revised expense guidance for 2013, anticipating operating expense to be up by 1-2% over 2012, lower than the prior band of 2-3%.

With respect to earnings trend, IntercontinentalExchange delivered positive earnings surprise in the past 4 quarters, with an average of 4.1%.

IntercontinentalExchange completed the acquisition of NYSE Euronext Inc. last month for $11.0 billion. The acquisition has further strengthened the company's operational base to 16 global exchanges and 5 central clearing houses. The merger is expected to generate more than 15% of earnings accretion within the first year of completion of the deal.

Management projects run-rate expenses synergies of about $450 million, to be reaped in the second year of the merger. The acquisition will provide IntercontinentalExchange with a strong competitive advantage.

IntercontinentalExchange is also eyeing Asia with its announced intention to buy Singapore Mercantile Exchange (SMX). The deal further extends ICE's growth curve and amplifies its global business opportunities.

ICE's November daily futures volume registered an increase of 5%.

Valuation for IntercontinentalExchange looks stretched. The shares are trading at a premium to the peer group average both on a price-to-book basis and on a forward price-to-earnings basis. Return on equity is lower than the peer group average. However, year-to-date return from the stock was 79.2%, much above the S&P's return of 27.4%.

IntercontinentalExchange presently carries a Zacks Rank #2 (Buy). Some other stocks worth considering in the finance sector include Hallmark Financial Services Inc . ( HALL ), Kemper Corp . ( KMPR ) and Brookfield Asset Management Inc. ( BAM ). All these sport Zacks Rank #1 (Strong Buy).

BROOKFIELD ASST (BAM): Free Stock Analysis Report

HALLMARK FINL (HALL): Free Stock Analysis Report

INTERCONTNTLEXC (ICE): Free Stock Analysis Report

KEMPER CORP (KMPR): Free Stock Analysis Report

To read this article on click here.

Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

In This Story


Other Topics


Latest Markets Videos


Zacks is the leading investment research firm focusing on stock research, analysis and recommendations. In 1978, our founder discovered the power of earnings estimate revisions to enable profitable investment decisions. Today, that discovery is still the heart of the Zacks Rank. A wealth of resources for individual investors is available at

Learn More