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Intercontinental (ICE) to Report Q3 Earnings: What's Up?

Zacks Equity Research

Intercontinental Exchange, Inc. ICE is slated to report third-quarter 2019 results on Oct 31, after market closes. The company delivered positive surprise in the last four quarters with the average being 3.49%.

Factors to Consider

Intercontinental Exchange’s third-quarter revenues are likely to have benefited from a compelling product and service portfolio, strategic acquisitions, pricing and analytics. The Zacks Consensus Estimate for revenues is pegged at $1.3 billion, indicating 9% increase from the year-ago reported figure.

The company expects the momentum in data revenue growth to continue. The company expects data revenues to be in the range of $550 million to $555 million in the third quarter.

In the third quarter, Intercontinental Exchange’s average daily volume (ADV) increased 12% year over year while open interest increased 11% year over year.

Expenses are likely to have been on the higher side due to higher compensation and professional services, rent and occupancy, selling, general and administrative and depreciation and amortization. This, in turn, might have restricted margin expansion.

The company estimates third-quarter adjusted operating expenses in the range of $552 million to $562 million. This includes $9 million to $10 million related to acquisition of Simplifile and roughly $10 million related to the revenue reclassification. These expenses will be more than offset by around $25 million in revenues, which, in turn will be accretive to the bottom line.

The Zacks Consensus Estimate for earnings is pegged at 95 cents, indicating an increase of 11.7% from the prior-year quarter reported figure.

What Our Quantitative Model States

Our proven model predicts an earnings beat for Intercontinental Exchange in the soon-to-be-reported quarter because it has the right combination of two key ingredients. A stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for a likely positive surprise.

Earnings ESP: Intercontinental Exchange’s Earnings ESP is +0.07%. The Zacks Consensus Estimate is pegged at 95 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

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 has a Zacks Rank #2.

Other Stocks to Consider

Some stocks from the finance industry with the apt combination of elements to surpass estimates this reporting cycle are as follows:

Cboe Global Markets CBOE, set to report third-quarter earnings on Nov 1, has an Earnings ESP of +0.72% and a Zacks Rank of 3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Athene Holding ATH is set to report third-quarter earnings on Nov 5. It has an Earnings ESP of +0.09% and a Zacks Rank of 3.

American Finance Trust AFIN is set to report third-quarter earnings on Nov 6. It has an Earnings ESP of +2.04% and a Zacks Rank of 3.

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