Intercontinental Exchange, Inc. Just Missed Earnings - But Analysts Have Updated Their Models

Investors in Intercontinental Exchange, Inc. (NYSE:ICE) had a good week, as its shares rose 5.3% to close at US$135 following the release of its annual results. It looks like the results were a bit of a negative overall. While revenues of US$8.0b were in line with analyst predictions, statutory earnings were less than expected, missing estimates by 6.1% to hit US$4.19 per share. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for Intercontinental Exchange

After the latest results, the 13 analysts covering Intercontinental Exchange are now predicting revenues of US$9.19b in 2024. If met, this would reflect a meaningful 15% improvement in revenue compared to the last 12 months. Per-share earnings are expected to increase 4.5% to US$4.32. Before this earnings report, the analysts had been forecasting revenues of US$9.13b and earnings per share (EPS) of US$4.57 in 2024. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a minor downgrade to their earnings per share forecasts.

The consensus price target held steady at US$145, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Intercontinental Exchange at US$164 per share, while the most bearish prices it at US$124. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. The analysts are definitely expecting Intercontinental Exchange's growth to accelerate, with the forecast 15% annualised growth to the end of 2024 ranking favourably alongside historical growth of 9.9% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 6.6% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Intercontinental Exchange is expected to grow much faster than its industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at US$145, with the latest estimates not enough to have an impact on their price targets.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Intercontinental Exchange going out to 2026, and you can see them free on our platform here.

It is also worth noting that we have found 2 warning signs for Intercontinental Exchange (1 is a bit concerning!) that you need to take into consideration.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.