JP Morgan on ICE

Barron’s passes on JP Morgan’s opinion on Intercontinental Exchange (ICE):

ICE’s stock price has underperformed in 2021. However, we see ICE on the cusp of returning to repurchasing its stock for the first time since it announced the acquisition of Ellie Mae in Aug 2020. We estimate ICE has deleveraged enough to begin repurchasing shares in the fourth quarter and will initially divide its significant cash flow between repurchasing shares and deleveraging. ICE’s stock has outperformed in the past when it was actively repurchasing its shares. Furthermore, we see ICE’s businesses performing well, with energy-trading revenue growth solid, in particular, and with further upside potential, should the better activity levels seen more recently persist. ICE data growth is solid at 5% to 6%, and we see the potential for organic growth in ICE’s mortgage business potentially surprising to the upside, despite lower refinance activity. We maintain our Overweight rating and $139 price target.

Posted by on October 8th, 2021 at 11:30 pm


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