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Intercontinental (ICE) to Report Q4 Earnings: What's in Store?

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Intercontinental Exchange Group ICE is slated to report fourth-quarter 2021 results on Feb 3, before market open. The company beat earnings estimates in two of the three reported quarters of 2021 and matched the same once.

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

Improved results at Exchanges, Fixed Income and Data Services, and Mortgage Technology segments are likely to have aided revenues in the to-be-reported quarter. The company estimates consolidated revenues for fourth-quarter 2021 in the range of $892 million to $907 million. The Zacks Consensus Estimate for revenues is pegged at $1.8 billion, indicating an 8.8% increase from the year-ago reported figure.

For the fourth quarter, management estimates recurring revenues in the Fixed Income and Data Services segment to improve sequentially to a range of $415 million to $420 million and in the range of $330 million and $335 million in the Exchange segment.

In the to-be-reported quarter, the Exchange segment is likely to have benefited from higher Commodities and Financial volumes traded. The Zacks Consensus Estimate for Exchange revenues is pegged at $999 million.

Continued strength in the pricing and analytics business driven by strong customer demand for the company’s pricing and reference data products, and connectivity offerings are likely to have boosted data revenues.

The Zacks Consensus Estimate for Fixed Income and Data Services revenues is pegged at $479 million.

The Mortgage Technology segment revenues are likely to have benefited from new customer growth and increased adoption of digital workflow tools across origination technology, closing solutions, and data and analytics. For fourth-quarter 2021, ICE guided recurring revenues in the Mortgage Technology segment between $147 million and $152 million, indicating around 25% growth year over year on a pro-forma basis. The Zacks Consensus Estimate for Mortgage Technology revenues is pegged at $352 million.

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 a strong retention rate of existing customers, the addition of new customers, increased purchases by existing customers, and increases in pricing of products.

Expenses are likely to have increased, given an 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. ICE expects fourth-quarter 2021 GAAP operating expenses in the range of $922 million to $932 million. Adjusted operating expenses are expected to be in the range of $737 million to $747 million, including approximately $10 million related to Bakkt. Adjusted non-operating expenses are expected to be in the range of $100 million to $105 million in the fourth quarter of 2021. For 2021, adjusted operating expenses are now expected to be in the range of $2.95 -$2.98 billion. Operating expenses are expected to be in the range of $3.610 billion to $3.640 billion.

The Zacks Consensus Estimate for earnings is pegged at $1.32, indicating an increase of 16.8% from the prior-year quarter reported figure.

ICE reported solid average daily volume (ADV) for the fourth quarter of 2021. ADV increased 16% to 5.9 million contracts, driven by 14.8% higher Commodities and a 17.9% increase in Financial ADV

What the Zacks Model Says

Our proven model does not conclusively predict 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. That is not the case as you can see below.

Earnings ESP: Intercontinental Exchange has an Earnings ESP of -0.30%. 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 3.

Stocks to Consider

Arch Capital Group ACGL has an Earnings ESP of +1.48% and a Zacks Rank of 2. The Zacks Consensus Estimate for Arch Capital’s fourth-quarter earnings is pegged at $1.02, indicating an increase of 82.1% from the year-ago reported figure.

Arch Capital delivered an earnings beat in all the three reported quarters of 2021.

Aflac Incorporated AFL has an Earnings ESP of +3.34% and a Zacks Rank #3. The Zacks Consensus Estimate for Aflac’s fourth-quarter earnings is pegged at $1.25, indicating an increase of 16.8% from the year-ago reported figure.

Aflac beat earnings estimates in all the three reported quarters of 2021.

Allstate Corporation ALL has an Earnings ESP of +2.86% and a Zacks Rank of 3. The Zacks Consensus Estimate for Allstate’s fourth-quarter earnings is pegged at $2.74, indicating a decrease of 53.3% from the year-ago reported figure.

Allstate beat earnings estimates in two of the three reported quarters of 2021 while missing in one.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.


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

Aflac Incorporated (AFL) : Free Stock Analysis Report

The Allstate Corporation (ALL) : Free Stock Analysis Report

Arch Capital Group Ltd. (ACGL) : Free Stock Analysis Report

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