Intercontinental Exchange (ICE) Q3 Earnings, Revenues Top
Intercontinental Exchange ICE reported third-quarter 2021 adjusted earnings per share of $1.30, which beat the Zacks Consensus Estimate of $1.23. The bottom line improved 26.2% on a year-over-year basis.
The company witnessed improved revenues at Exchanges, Fixed Income, and Data Services and Mortgage Technology segments.
Intercontinental Exchange Inc. Price, Consensus and EPS Surprise
Intercontinental Exchange Inc. price-consensus-eps-surprise-chart | Intercontinental Exchange Inc. Quote
Performance in Detail
Intercontinental Exchange’s revenues of $1.8 billion increased 28% year over year on higher revenues at Exchanges, Fixed Income, and Data Services and Mortgage Technology. The top line beat the Zacks Consensus Estimate by 2.7%.
Net revenues from Exchanges were $959 million, up 17% year over year. Fixed Income and Data Services revenues were $458 million, which increased 6% year over year. Mortgage Technology revenues more than doubled year over year to $366 million.
Adjusted operating expenses were $755 million for the third quarter, up 23.6% from the year-ago figure.
Adjusted operating income improved 30.9% year over year to $1 billion. Adjusted operating margin expanded 100 basis points (bps) from the year-ago quarter to 58%.
Exchanges' adjusted operating income of $650 million was up 20.6% year over year. Adjusted operating margin expanded 200 bps to 66%.
Fixed Income and Data Services' adjusted operating income increased 8.2% to $184 million. Adjusted operating margin expanded 100 bps to 39%.
Mortgage Technology’s adjusted operating income of $213 million more than doubled year over year. Adjusted operating margin contracted 600 bps to 58%.
Financial Update
As of Sep 30, 2021, Intercontinental Exchange had cash and cash equivalents of $1.65 billion, up nearly 5.1% from the level as of Dec 31, 2020. Long-term debt of $12.4 billion was down 12.3% from the 2020-end level.
Total equity was $21.6 billion as of Sep 30, 2020, up 10.5% from 2020 end.
Operating cash flow was $2.1 billion in the first nine months of 2021, up 17.4% year over year. Free cash flow was about $2 billion, up 22.2% year over year.
Fourth-Quarter 2021 Guidance
Total recurring revenues are estimated between $892 million and $907 million.
Operating expenses are projected in the range of $922-$932 million. Adjusted operating expenses are expected to be in the range of $737 million to $747 million and include $50 million related to Bakkt.
Non-operating income is expected to be in the range of $1.185 billion to $1.190 billion, including an expected gain on the Bakkt merger of approximately $1.3 billion.
Adjusted non-operating expense is expected to be in the range of $100 million to $105 million.
Weighted average shares outstanding are anticipated between 563 million and 569 million shares.
Zacks Rank
Intercontinental Exchange currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Securities and Exchanges
Third-quarter earnings of Nasdaq NDAQ, MarketAxess Holdings MKTX and CME Group CME beat the respective Zacks Consensus Estimate.
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