Intercontinental Exchange Inc (NYSE:ICE) — This large-cap growth stock represents equity in a fully electronic marketplace that offers exchange-based and OTC trading of many energy and soft commodity products. It expanded its global operations with the acquisition of Interactive Data Corp in December 2015. This gave ICE a stronger position in derivatives trading products in Europe.
Standard & Poor’s forecasts that President Donald Trump administration’s regulatory and business procedures and policies will be positive for this exchange. Higher commodities trading volumes, rising interest rates, and expansion of non-trading activities should add to top and bottom lines.
They kept their 12-month price target at $68 on a forward price-to-earnings ratio of 22.1X their 2017 earnings estimates. Their earnings per share for 2017 is $3.07 and 2018 is at $3.40. Last August, ICE stock started a $1 billion share buyback plan that started in November. As of February they had executed 20% of that plan.
I anticipate that consensus earnings and revenue forecasts will expand as the quarterly profits accrue and ICE progresses with their stock-purchase plan.
ICE stock is trading in a broad bull channel that began with a long-term buy signal, a Golden Cross, in May 2016. Since then the channel has advanced at about 30 degrees with almost every top resulting in a pullback to the channel’s support line. On March 17 ICD flashed its latest reversal and the stock fell from $62 to its 50-day moving average at about $59.
Therefore try to buy ICE under $60 with a trading target of $68 for a proposed trade of over 11%. Long-term investors may buy this five-star S&P “strong buy” at the current price as an investment in the growing Financial Exchanges and data markets.
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