Intercontinental Exchange (ICE) Beats Q1 Earnings Estimates

Intercontinental Exchange, Inc. (NYSE:ICE) reported first-quarter 2017 adjusted earnings per share of 74 cents, which beat the Zacks Consensus Estimate of 73 cents by a penny. Earnings remained flat on a year-over-year basis.

The quarter witnessed growth across the company’s data and listings business segments, strong volumes and open interest growth in futures markets.

On a GAAP basis, net income was 84 cents per share, up 35% year over year.

Performance in Details

Total revenue of $1.16 billion met the Zacks Consensus Estimate. Revenues increased 0.6% year over year, primarily due to higher data services revenues and rise in listings revenues.

Total operating expenses increased 2.1% year over year to $582 million. This was primarily due to higher compensation and benefits, technology and communication as well as selling, general and administrative expenses.

Operating income dipped 0.3% to $582 million. Operating margin was 50% in the quarter.

Intercontinental Exchange Inc. Price, Consensus and EPS Surprise

Financial Update

Cash flows from operations were $611 million.

At the end of the quarter, Intercontinental Exchange had cash and cash equivalents of $360 million, down 11.5% from Dec 31, 2016. Long-term debt of $3.8 billion remained flat with 2016-end level.

Total equity was $15.79 billion as of Mar 31, 2017 as against $15375 billion as of Dec 31, 2016.

Guidance

Adjusted operating expenses is estimated between $485 million and $495 million for the second quarter.

Amortization of acquisition-related intangibles for the second quarter is expected to be about $66 million.

Intercontinental Exchange's diluted share count for second quarter is likely to be in the range of 590–600 million.

Our Take

Results of Intercontinental Exchange reveal a decent performance. The company remains well poised for growth given its strength in its energy franchise, increasing recurring market data revenues and strategic initiatives.

Intercontinental Exchange presently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Among others securities exchanges, MarketAxess, Inc. (NASDAQ:MKTX) , CME Group Inc. (NASDAQ:CME) and Nasdaq, Inc. (NASDAQ:NDAQ) beat their respective Zacks Consensus Estimate in the reported quarter.

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