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What Awaits Intercontinental Exchange (ICE) in Q1 Earnings?

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Intercontinental Exchange Group ICE is slated to report first-quarter 2021 results on Apr 29, before market open. The company delivered an earnings surprise in each of the last four quarters, the average being 3.67%.

Let’s see how things have shaped up for this announcement.

Favorable financing conditions, consolidated feeds, transaction-based revenues, growth across its business lines and strong retention rate are expected to have benefited first-quarter performance of Intercontinental Exchange.

Revenues are likely to have benefited from better performance at Exchanges, Fixed income and data services, and Mortgage technology segments. The Zacks Consensus Estimate for revenues is pegged at $1.7 billion, indicating 13.4% increase from the year-ago reported figure.

Transaction revenues are expected to have benefited from growth in energy business and growth in cash equities and options trading.

For first-quarter 2021, recurring revenues in the Exchange segment are expected to be $310-$315 million.

Annual subscription value (ASV) is likely to have increased in the first quarter.

Mortgage Technology segment revenues are likely to have benefited from favorable financing conditions, accelerating millennial homeownership trends and demand for digital workflow tools.

For first-quarter 2021, recurring revenues in the Mortgage Technology segment are expected to be $122-$127 million, indicating around 30% growth year over year on a pro forma basis.

Other data and network services is expected to have benefited from continued growth in customer demand for both ICE Global Network and consolidated feeds.

Fixed income data and analytics revenues are likely to have benefited from strength in index business, and continued growth in pricing and reference data business, fueled by strong retention rate of existing customers, addition of new customers, increased purchases by existing customers and increases in pricing of products.

For first-quarter 2021, recurring revenues in fixed income and data services segment are expected to be $395-$400 million.

Expenses are likely to have increased given increase in compensation and benefits, professional services, acquisition-related transaction and integration as well as technology and communication costs, rent and occupancy, and selling, general and administrative expenses. This, in turn, might have restricted margin expansion and hurt the company’s overall performance. For first-quarter 2021, adjusted operating expenses are expected to be $720-$730 million including roughly $23 million related to Bakkt.

The Zacks Consensus Estimate for earnings is pegged at $1.30, indicating an increase of 1.5% from the prior-year quarter reported figure.

What the Zacks Model Says

Our proven model predicts an earnings beat for Intercontinental Exchange this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.

Earnings ESP: Intercontinental Exchange has an Earnings ESP of +0.77%. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

Intercontinental Exchange Inc. Price and EPS Surprise

Intercontinental Exchange Inc. Price and EPS Surprise
Intercontinental Exchange Inc. Price and EPS Surprise

Intercontinental Exchange Inc. price-eps-surprise | Intercontinental Exchange Inc. Quote

Zacks Rank: Intercontinental Exchange currently carries a Zacks Rank of 2.

Other Stocks to Consider

Some other stocks worth considering from the finance sector with a perfect mix of elements to surpass estimates in their upcoming quarterly releases are as follows:

Alliance Data Systems Corporation ADS has an Earnings ESP of +7.39% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

EVO Payments, Inc. EVOP has an Earnings ESP of +12.64% and a Zacks Rank of 3, at present.

Fidelity National Information Services, Inc. FIS has an Earnings ESP of +2.01% and a Zacks Rank #3.

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Fidelity National Information Services, Inc. (FIS) : Free Stock Analysis Report

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Intercontinental Exchange Inc. (ICE) : Free Stock Analysis Report

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