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Intercontinental (ICE) to Report Q1 Earnings: What's in Store?

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Intercontinental Exchange Inc. (ICE - Free Report) is slated to report first-quarter 2023 earnings on May 4, before market open. ICE delivered an earnings surprise in three of the last four quarters and missed in one, the average being 1.75%.

Factors to Note

Solid performance at Exchanges and Fixed Income and Data Services segments is likely to have aided revenues in the to-be-reported quarter.
 
Growth in ICE bonds and CDS clearing business, market volatility, higher interest rates as well as strong growth across desktop, feeds and analytics offerings are likely to have aided Fixed Income and Data Services. The Zacks Consensus Estimate for the segment’s revenues is pegged at $251 million. We expect the metric to be $ $530.6 million.

The Exchange segment is likely to have benefited from higher transaction revenues, growth in agricultural commodities and equity derivatives business. Increase in interest rate business, equity derivatives as well as global natural gas revenues are also likely to have added to the upside. The Zacks Consensus Estimate for the segment’s revenues is pegged at $553 million, indicating an 8.6% increase from the year-ago reported figure. We expect the metric to be $1 billion.

The Mortgage Technology segment’s revenues are likely to have been affected by lower mortgage origination volumes driven by rising interest rates. The Zacks Consensus Estimate for the segment’s revenues is pegged at $316 million. We expect the metric to be $$298.3 million.

Expenses are likely to have decreased because of lower compensation and benefits, professional services, acquisition-related transaction and integration costs, technology and communication, and rent and occupancy.

ICE expects first-quarter 2023 operating expenses in the range of $895-$905 million, while adjusted operating expenses are expected in the range of $745-$755 million. Non-operating expense is expected in the range of $115 million to $125 million. Adjusted non-operating expense is expected in the range of $95-$100 million. Weighted average shares outstanding are anticipated between 558 million and 564 million.

The Zacks Consensus Estimate for earnings is pegged at $1.38 per share, indicating a decrease of 3.5% from the prior-year quarter’s reported figure. We estimate bottom line to be $1.27.

ICE reported a 4% increase in first-quarter average daily volume (ADV). Total Natural Gas ADV was up 10%. Total Agricultural & Metals ADV increased 10% and total Financials ADV gained 13%.

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 +1.17%. This is because the Most Accurate Estimate of $1.40 is pegged higher than the Zacks Consensus Estimate of $1.38. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

Zacks Rank: ICE currently carries a Zacks Rank of 2.

Other Stocks to Consider

Some other finance stocks with the right combination of elements to come up with an earnings beat this time around are:

American Equity Investment Life Holding Company has an Earnings ESP of +1.44% and a Zacks Rank of 3 at present. The Zacks Consensus Estimate for first-quarter 2023 earnings is pegged at $1.09, indicating an increase of 18.5% from the year-ago reported figure. You can see the complete list of today’s Zacks #1 Rank stocks here.

AEL’s earnings beat estimates in two of the last four quarters and missed in the other two.

Armada Hoffler Properties, Inc. (AHH - Free Report) currently has an Earnings ESP of +3.33% and a Zacks Rank of 2. The Zacks Consensus Estimate for first-quarter 2023 earnings is pegged at 30 cents, indicating an increase of 7.1% from the year-ago reported figure.

AHH’s earnings beat estimates in the last four reported quarters.

Cboe Global Markets (CBOE - Free Report) has an Earnings ESP of +2.07% and a Zacks Rank of 2 at present. The Zacks Consensus Estimate for first-quarter 2023 earnings is pegged at $1.82, indicating an increase of 5.2% from the year-ago reported figure.

CBOE’s earnings beat estimates in three of the last four quarters and missed in one.

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


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