May 25, 2023
Top 10 Stock Intercontinental Exchange Strong Buy Recommendation
How to read the ranks
For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Snapshot: Intercontinental Exchange – Top 10 Stock in Dow Jones U.S. Investment Services Index
Intercontinental Exchange is listed as a top 10 stock on May 25, 2023 in the market index D.J. US Investing because of its high performance in at least one of the Obermatt investment strategies. Three consolidated Obermatt Ranks are above-average. Only the Value Rank is below average. The investment rationale may be an investment in future growth, supported by professional market opinion. Based on the Obermatt 360° View of 79 (top 79% performer), Obermatt assesses an overall strong buy recommendation for Intercontinental Exchange on May 25, 2023.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Financial Exchanges & Data |
| Index | Employee Focus US, SDG 17, SDG 4, SDG 5, SDG 7, D.J. US Investing, S&P 500 |
| Size class | X-Large |
When Obermatt identifies the Top 10 stocks in a market, it’s based on a certain investment strategy. The best performing stocks usually aren’t the ones that everyone is talking about (those are often "over-priced" and have low Value ranks).
For each investment strategy, we provide you with more detailed analysis and our recommendation. You see the ranks of the top 10 stocks ranked by that particular investment strategy (360° View, Sentiment, Value, Growth, Safety and Combined Financial Performance).
360° View: Obermatt 360° Assessment Intercontinental Exchange Strong Buy
| 360 METRICS | May 25, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 30 |
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| GROWTH | ||||||||
| GROWTH | 51 |
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| SAFETY | ||||||||
| SAFETY | 72 |
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| SENTIMENT | ||||||||
| SENTIMENT | 82 |
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| 360° VIEW | ||||||||
| 360° VIEW | 79 |
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ANALYSIS: With an Obermatt 360° View of 79 (better than 79% compared with alternatives) for 2023, overall professional sentiment and engagement for the stock Intercontinental Exchange are very positive. The 360° View is based on consolidating four consolidated indicators, with all but one indicator above average for Intercontinental Exchange. The consolidated Growth Rank has a good rank of 51, which means that the company experiences above-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth, as well as stock returns. This means that growth is higher than for 51% of competitors in the same industry. The consolidated Safety Rank at 72 means that the company has a financing structure that is safer than 72 comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. Finally, the consolidated Sentiment Rank has a good rank of 82, which means that professional investors are more optimistic about the stock than for 82% of alternative investment opportunities. But the consolidated Value Rank is less desirable at 30, meaning that the share price of Intercontinental Exchange is on the higher side compared with indicators such as revenues, profits, and invested capital. This means the stock price is higher than for 70% of alternative stocks in the same industry. ...read more
RECOMMENDATION: With a 360° View of 79, Intercontinental Exchange is better than 79% of all alternative stock investment opportunities based on the Obermatt Method. As three out of four consolidated Obermatt Ranks exhibit excellent performance, such as above-average growth (Growth Rank of 51), a safe financing structure (Safety Rank of 72), and positive professional market sentiment (Sentiment Rank of 82), it is a solid stock investment where growth may be the strongest driver of the investment rationale, also reflected by institutional investors. It is typical for growth companies to have low value, as is the case here. Investors are willing to pay more for companies that outperform their competitors. So the question is, how much more do you pay for the stock of Intercontinental Exchange compared with alternatives? You can use the following rule of dumb: The growth rank reflects where the growth momentum of the company is (51% better than peers). The value rank could be the reverse reflection of that (49%). A Value Rank below that level may be assessed as expensive, a rank above that is still good value. Sometimes market sentiment just extrapolates the past, but sometimes they are right. You pay more than the market average for this stock, but it may be worth it. ...read more
Sentiment Strategy: Professional Market Sentiment for Intercontinental Exchange very positive
ANALYSIS: With an Obermatt Sentiment Rank of 82 (better than 82% compared with alternatives) for 2023, overall professional sentiment and engagement for the stock Intercontinental Exchange is very positive. The Sentiment Rank is based on consolidating four sentiment indicators, with all four indicators above average for Intercontinental Exchange. Analyst Opinions are at a rank of 85 (better than 85% of alternative investments), which means that, currently, stock research analysts tend to recommend a stock investment in the company. Analyst Opinions Change is also positive with a rank of 50, which means that stock research experts are changing their opinions for the better and recommending investing in the company. They are getting more optimistic about stock investments in Intercontinental Exchange. The Professional Investors rank is 64, which means that currently, professional investors hold more stock in this company than in 64% of alternative investment opportunities. Pros tend to favor investing in this company. Finally, Market Pulse has a rank of 67 which means that the current professional news and professional social networks are on the positive side when discussing this company (more positive news than for 67% of competitors). ...read more
RECOMMENDATION: With an Obermatt Sentiment Rank of 82 (more positive than 82% compared with investment alternatives), Intercontinental Exchange has a reputation among professional investors that is significantly higher than that of its competitors. Since all market sentiment indicators are positive, the professional community highly recommends investment in the company. Does this mean Intercontinental Exchange stocks are a safe investment? Far from it. Even professionals make mistakes. Especially in stock investing, there is a tendency to follow the leaders. Since trees don't grow to the heavens, such positive sentiment may also be interpreted as a danger sign. A lot of optimism can often be a sign of troubles to come, albeit unforeseen by most. ...read more
Value Strategy: Intercontinental Exchange Stock Price Value below-average critical
ANALYSIS: With an Obermatt Value Rank of 30 (worse than 70% compared with alternatives), Intercontinental Exchange shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, with all four indicators below average for Intercontinental Exchange. Price-to-Sales is 16 which means that the stock price compared with what market professionals expect for future profits is higher than 84% of comparable companies, indicating a low value concerning Intercontinental Exchange's sales levels. Price-to-Book Capital (also referred to as market-to-book ratio) also has a low Price-to-Book Rank of 43, which means that both reliable company size indicators, sales, and invested capital cannot explain the high stock price of Intercontinental Exchange. In addition, the two profit-related value indicators, Price-to-Profit (also referred to as price-earnings, P/E) with a low rank of 29 and Dividend Yield, which is lower than 52% of comparable companies, also make the stock more expensive compared with investment alternatives. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 30, is a HOLD recommendation based on Intercontinental Exchange's stock price compared with the company's operational size and dividend yields. How can market participants pay such a high price for Intercontinental Exchange? One reason may be that the company is simply too popular. If enough people want a particular stock, its price can exceed reasonable levels. This is often the case for companies offering new and exciting products and everybody wants a piece of the action. Should you pay a lot for a hot stock such as Intercontinental Exchange? It's risky, and even if it continues to grow because of popular demand, it will most likely return to what it's worth. And that return can be sudden and quick, making it impossible for retail investors to exit on time. Sometimes, high prices are deserved. This is the case when it is reasonable for the company to dominate a market with high profit margins. It has happened in the past for many technology companies and indeed for successful pharmaceutical discoveries. Sometimes they last, sometimes, they get eaten alive. Intercontinental Exchange may be such a type of stock. That would mean, retail investors should be careful, only considering investing a small part of their wealth in this exciting category and always being ready to lose more than half, if not all of the investment. ...read more
Growth Strategy: Intercontinental Exchange Growth Momentum good
ANALYSIS: With an Obermatt Growth Rank of 51 (better than 51% compared with alternatives), Intercontinental Exchange shows an above-average growth dynamic in its industry. Investors also speak of positive momentum. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Intercontinental Exchange. Capital Growth has a rank of 51, which means that currently professionals expect the company to grow its invested capital more than 40% of its competitors. Investors welcomed this, visible in the Stock Returns rank of 71 (above 71% of alternative investments). But Sales Growth has only a rank of 37, which means that, currently, professionals expect the company to grow less than 63% of its competitors, and Profit Growth is also low at a rank of 40. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 51, is a BUY recommendation for growth and momentum investors. This is an ambiguous picture. Revenue growth and capital growth are strong, but the growth in profit, which seems good, can also be an indication that growth momentum may be negative. The fact that stock returns have been above average doesn't help much, as stock returns are less reliable in showing a company’s future growth potential. Prices may perform well for the simple reason that investors were too pessimistic in the past and are now correcting their opinions and moving the stock price to a more reasonable level. As the growth picture is mixed for Intercontinental Exchange, investors may want to look at value and sentiment indicators for a well-rounded picture of this stock. ...read more
Safety Strategy: Intercontinental Exchange Debt Financing Safety above-average
| SAFETY METRICS | May 25, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 44 |
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| REFINANCING | ||||||||
| REFINANCING | 89 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 34 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 72 |
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ANALYSIS: With an Obermatt Safety Rank of 72 (better than 72% compared with alternatives), the company Intercontinental Exchange has financing practices on the safer side, which mean that their overall debt burden is lower than average. This doesn't mean that the business of Intercontinental Exchange is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with just one indicator above average for Intercontinental Exchange and the other two below average. Refinancing is at 89, meaning the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 89% of its competitors. But Leverage is high with a rank of 44, meaning the company has an above-average debt-to-equity ratio. It has more debt than 56% of its competitors. Liquidity is also on the riskier side with a rank of 34, meaning the company generates less profit to service its debt than 66% of its competitors. ...read more
RECOMMENDATION: With an Obermatt Safety Rank of 72 (better than 72% compared with alternatives), Intercontinental Exchange has a financing structure that is safer than that of its competitors. A good Refinancing Rank means that the problems of the company may not be around the corner. But high Leverage is only good if things go well, and low Liquidity is a signal for caution. The financing signals for Intercontinental Exchange are on the riskier side, requiring the company's future to be on the safer side. Investors may want to look at Growth and Sentiment ranks before making a financial decision. ...read more
Combined financial peformance: Intercontinental Exchange Above-Average Financial Performance
| COMBINED PERFORMANCE | May 25, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 30 |
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| GROWTH | ||||||||
| GROWTH | 51 |
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| SAFETY | ||||||||
| SAFETY | 34 |
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| COMBINED | ||||||||
| COMBINED | 60 |
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ANALYSIS: With an Obermatt Combined Rank of 60 (better than 60% compared with investment alternatives), Intercontinental Exchange (Financial Exchanges & Data, USA) shares have above-average financial characteristics compared with similar stocks. Shares of Intercontinental Exchange are low in value (priced high) with a consolidated Obermatt Value Rank of 30 (worse than 70% of alternatives). But they show above-average growth (Growth Rank of 51) and are safely financed (Safety Rank of 72, which means below-average debt burdens). ...read more
RECOMMENDATION: An Obermatt Combined Rank of 60, is a buy recommendation based on Intercontinental Exchange's financial characteristics. Investors looking for growth and low financial risk may find this stock attractive. While the company Intercontinental Exchange exhibits low value (Obermatt Value Rank of 30), which means that the stock price is rather high, it also demonstrates above-average growth (Obermatt Growth Rank of 51). This is a typical case, as high-growth companies are often expensive. Good financing practices (Obermatt Safety Rank of 72) are a double-edged sword: if the company continues growing, low debt limits shareholder returns. But if the company increases its debt, it will also increase risk. In other words, this is an investment on the safer side, despite the above-average price (low value). ...read more
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