At $73.12, Is It Time To Buy Intercontinental Exchange Inc (NYSE:ICE)?
Today we’re going to take a look at the well-established Intercontinental Exchange Inc (NYSE:ICE). The company’s stock saw a decent share price growth in the teens level on the NYSE over the last few months. With many analysts covering the large-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. But what if there is still an opportunity to buy? Let’s examine Intercontinental Exchange’s valuation and outlook in more detail to determine if there’s still a bargain opportunity. View our latest analysis for Intercontinental Exchange
Is Intercontinental Exchange still cheap?
The stock is currently trading at $73.12 on the share market, which means it is overvalued by 81% compared to my intrinsic value of $40.5. This means that the opportunity to buy Intercontinental Exchange at a good price has disappeared! Furthermore, Intercontinental Exchange’s share price also seems relatively stable compared to the rest of the market, as indicated by its low beta. If you believe the share price should eventually reach its true value, a low beta could suggest it is unlikely to rapidly do so anytime soon, and once it’s there, it may be hard to fall back down into an attractive buying range.
Can we expect growth from Intercontinental Exchange?
Future outlook is an important aspect when you’re looking at buying a stock, especially if you are an investor looking for growth in your portfolio. Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at the company’s future expectations. Intercontinental Exchange’s earnings growth are expected to be in the teens in the upcoming years, indicating a solid future ahead. This should lead to robust cash flows, feeding into a higher share value.
What this means for you:
Are you a shareholder? It seems like the market has well and truly priced in Intercontinental Exchange’s positive outlook, with shares trading above its fair value. However, this brings up another question – is now the right time to sell? If you believe Intercontinental Exchange should trade below its current price, selling high and buying it back up again when its price falls towards its real value can be profitable. But before you make this decision, take a look at whether its fundamentals have changed.
Are you a potential investor? If you’ve been keeping tabs on Intercontinental Exchange for some time, now may not be the best time to enter into the stock. The price has surpassed its true value, which means there’s no upside from mispricing. However, the optimistic prospect is encouraging for Intercontinental Exchange, which means it’s worth diving deeper into other factors in order to take advantage of the next price drop.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Intercontinental Exchange. You can find everything you need to know about Intercontinental Exchange in the latest infographic research report. If you are no longer interested in Intercontinental Exchange, you can use our free platform to see my list of over 50 other stocks with a high growth potential.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.
