Intercontinental Exchange ICE reported third-quarter 2024 adjusted earnings per share of $1.55, in line with the Zacks Consensus Estimate. The bottom line increased 6.2% on a year-over-year basis.
Intercontinental delivered solid results in all three segments. The performance reflected the strength of a balanced and diversified business as well as the results of the strategic investments it has made.
Performance in Detail
Intercontinental’s net revenues were a record $2.3 billion, up 17% year over year. The top line missed the Zacks Consensus Estimate by 0.1%.
Total operating expenses increased 7.6% year over year to $1.2 billion. This can be primarily attributed to higher compensation and benefits, professional services, technology and communication, rent and occupancy, and depreciation and amortization expense. Our estimate was also $1.2 billion.
Adjusted operating expenses were $960 million in the quarter, up 18.2% year over year. Our estimate was $969.5 million.
Adjusted operating income rose 17% year over year to a record $1.4 billion. Our estimate was $1.4 billion. Adjusted operating margin was flat year over year at 59%. Our estimate was 50%.
Segment Details
Exchanges' net revenues were $1.3 billion, up 13% year over year. The Zacks Consensus Estimate and our estimate were both pegged at $1.6 billion.
Adjusted operating income of $945 million was up 15.7% year over year. Our estimate was $840.7 million. The Zacks Consensus Estimate was pegged at $887 million.
Adjusted operating margin expanded 200 bps year over year to 75%. Our estimate was 69.6%.
Fixed Income and Data Services' revenues were $586 million, which increased 5% year over year. Our estimate was $604.9 million. The Zacks Consensus Estimate was pegged at $593 million.
Adjusted operating income rose 8.2% to $263 million. Our estimate was $220.9 million. The Zacks Consensus Estimate was pegged at $244 million.
Adjusted operating margin expanded 100 bps year over year to 45%. Our estimate was 36.5%.
Mortgage Technology’s revenues increased 54% to $509 million. Our estimate was $522.3 million. The Zacks Consensus Estimate was pegged at $519 million.
Adjusted operating income was $181 million, which surged 32.8% year over year. The Zacks Consensus Estimate was pegged at $245 million. Our estimate was $303.5 million.
Adjusted operating margin contracted 400 bps year over year to 35%. Our estimate was 58.1%.
Financial Update
As of Sept. 30, 2024, Intercontinental had cash and cash equivalents, including short-term restricted cash and cash equivalents of about $2 billion, up 39.7% from Dec. 31, 2023. Long-term debt of $18.6 billion decreased 10% from 2023-end.
Total equity was $27.2 billion as of Sept. 30, 2023, up 5.8% from 2023-end.
Operating cash flow was $3.1 billion in the first nine months of 2024, up 20.6% year over year. Adjusted free cash flow was $2.6 billion, up 7.3% year over year.
Intercontinental paid out $780 million in dividends in the first nine months of 2024.
Fourth-Quarter 2024 Guidance
GAAP operating expenses are expected in the range of $1.23-$1.24 billion.Adjusted operating expenses are projected to be between $977 million and $987 million.
GAAP non-operating expense as well as adjusted non-operating expense is anticipated between $180 million and $185 million.
Share count is forecast in the range of 574-580 million.
2024 Guidance
Capital expenditures are expected to be in the range of $700 million to $740 million.
Dividend Update
The board of directors approved a dividend of 45 cents per share for the fourth quarter of 2024. The dividend will be paid out on Dec. 31 to shareholders of record as of Dec. 16.
Zacks Rank
Intercontinental currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance Industry Players
CME Group CME reported third-quarter 2024 adjusted earnings per share of $2.68, which beat the Zacks Consensus Estimate by 1.1%. The bottom line increased 19.1% year over year. Revenues of $1.6 billion increased 18.4% year over year. The top line beat the Zacks Consensus Estimate by 0.7%.
Operating income increased 24.8% from the prior-year quarter to $1 billion. Our estimate was $954.4 million. ADV was 28.2 million contracts, including record non-U.S. ADV, with EMEA up 30% and Asia up 28% year over year. The total average rate per contract was 66.6 cents.
Nasdaq NDAQ reported third-quarter 2024 adjusted earnings per share (EPS) of 74 cents, which beat the Zacks Consensus Estimate by 7.3%. Nasdaq’s revenues of $1.1 billion decreased 21% year over year. The top line missed the Zacks Consensus Estimate by 1.8%.
Annualized Recurring Revenue (ARR) increased 31% year over year to $2.7 billion. Adjusted operating margin of 54% expanded 200 basis points year over year. The Nasdaq stock market welcomed 138 new company listings in third-quarter 2024, including 48 initial public offerings. The number of listed companies was 4,039 at the quarter end.
Nasdaq expects 2024 non-GAAP operating expenses to be in the range of $2.15-$2.180 billion compared with $2.145 billion to $2.185 billion guided earlier.
Upcoming Release
Cboe Global Markets CBOE is set to report third-quarter 2024 results on Nov. 1, before market open. The Zacks Consensus Estimate for third-quarter EPS is pegged at $1.82, suggesting an increase of 24.7% from the year-ago quarter’s reported figure.
CBOE’s earnings beat estimates in three of the last four reported quarters while missing in one.
5 Stocks Set to Double
Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
Today, See These 5 Potential Home Runs >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Intercontinental Exchange Inc. (ICE): Free Stock Analysis Report
CME Group Inc. (CME): Free Stock Analysis Report
Nasdaq, Inc. (NDAQ): Free Stock Analysis Report
Cboe Global Markets, Inc. (CBOE): Free Stock Analysis Report