$ICE (+1,19 %)
The Intercontinental Exchangefor short ICE! A company behind some of the largest stock exchanges in the world - including the NYSE! But how strong is ICE really? Is an investment worthwhile? And what risks are lurking? I'll find out now
📌 Company profile
- Founded: 2000 in Atlanta, USA.
- Most important acquisition: Purchase of the New York Stock Exchange (NYSE) in 2013!
- Market capitalization: Around 101.10 billion US dollars - a real heavyweight!
- Performance: Over the last 10 years +300% return (≈ 15.2% per year)!
💰 Key financial figures - the hard facts!
📈 Turnover per share:
- Strong growth: Almost tripled in 10 years (≈ 11.6% per year).
- There was a dip in 2022but things have been on the up again since then - thanks to data services, ESG products and high trading volumes on the NYSE!
📉 Return on invested capital (ROIC):
- Low! Highest value in 2017: 11.14% - Not exactly stunning.
- Why? High investments (clearing houses, acquisitions) depress the yield.
💵 Dividend:
- Has only been paid for 10 years paid, but growing strongly (over 10% per year).
- Payout ratio still low → Potential for further increases!
⚠️ Risks - Where are the dangers lurking?
1️⃣ Regulatory hurdles:
- ICE operates in a strictly regulated environment (CFTC, FINRA, Basel III).
- New rules could increase costs - especially in the clearing business!
2️⃣ Mortgage technology (22% of sales):
- High interest rates slow down the real estate market. [1]
- Loan defaults are rising (3.47% in January 2025).
- Natural disasters (e.g. forest fires in California) are an additional burden.
📊 Q1 2025 - The results!
- Earnings per share (EPS): 1.72 $ (adjusted) - 2 cents above expectations!
- Turnover: 2.47 billion dollars
- Strongest segment:
Exchange segment (+12% sales, 76% margin!) - Weakness:
Mortgage segment (0% growth, negative margin)
🔮 Outlook: Q2 2025 - What's next?
- Result expected on July 31, 2025.
- Forecast:
1.74 EPS,2.5bn.EPS,2,5bn. Turnover - will exceed ICE again
Valuation based on reversed DCF method:
Thus, with the reversed DCF method involves working backwards from the current market price of a share. And the idea behind it is to calculate the growth rates and cash flows that the market implicitly expects for the current price.
This means that in order to justify the current share price, the free cash (FCF) would have to increase by 7,159% over the next 10 years.
And the company has outperformed this 7,159% over the last 5 and 10 years, so it seems to me to be somewhat relatively undervalued.
not investment advice !!!
Conclusion:
ICE is a strong but complex investment - with growth potential, but also risks! Anyone looking for stable dividends and long-term trends could find what they are looking for here. But beware: the regulatory and macroeconomic challenges should not be underestimated!
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[1] https://fxnewsgroup.com/forex-news/exchanges/ice-registers-steep-increase-in-revenues-in-q1-2025/