Intercontinental Exchange
ICE
$157.75
+0.22%
Intercontinental Exchange, Inc. (ICE) operates a vertically integrated network of financial exchanges, clearinghouses, and data services, best known for owning the New York Stock Exchange and running the dominant ICE Brent crude oil futures franchise. Beyond its exchanges business — roughly 54% of net revenue — ICE has built out a mortgage technology platform (about 22% of revenue) and a fixed-income and data-services segment (about 24%), positioning it as a diversified financial infrastructure and data provider rather than a pure-play trading venue. The current investor narrative centers on the durability of recurring data and technology revenue against the cyclicality of trading volumes, with the most recent quarter showing 13.5% year-over-year revenue growth and a sharp margin uplift. Debate is also focused on the stock's underperformance versus the broader market over the past year, despite a strong buy consensus from Wall Street, as investors weigh whether the recent momentum reversal is a durable inflection or a dead-cat bounce.…
ICE
Intercontinental Exchange
$157.75
Investment Opinion: Should I buy ICE Today?
Rating: Buy. The synthesized recommendation is Buy, anchored by a strong_buy analyst consensus (recommendation mean of 1.47 from 14 analysts) and an average target price of $187.29, implying +19.0% upside from the current $157.40. The core thesis is that ICE's revenue re-acceleration to 13.53% year-over-year, combined with a dramatic gross margin expansion to 81.21%, positions the company for earnings growth that will justify its forward PE of 17.89x and drive multiple expansion toward the higher end of its historical range.
The supporting evidence is compelling: revenue grew 13.53% year-over-year to $3.666 billion in Q1 2026, up from $3.229 billion a year ago; net margin expanded to 38.54% from 24.68%; free cash flow TTM is $4.558 billion, comfortably covering $646 million in quarterly buybacks and $297 million in dividends; and the forward PE of 17.89x is 36% below the trailing PE of 27.92x, implying significant expected earnings growth. The PEG ratio of 1.34 is reasonable for a company with double-digit revenue growth and expanding margins, and the dividend yield of 1.19% with a payout ratio of 33.4% leaves ample room for continued capital returns. Relative to its own history, the forward PE is near the low end of the 15.8x–49.4x band, suggesting the stock is undervalued on a forward basis.
The biggest risks that could invalidate the thesis are: (1) flat EBITDA growth despite revenue acceleration, which raises questions about earnings quality; (2) a wide analyst target dispersion of $69.00, signaling execution uncertainty; and (3) the stock's 26.87 percentage point underperformance versus the S&P 500 over the past year, which could persist if sector rotation continues. The rating would upgrade to a stronger Buy if EBITDA begins to grow in line with revenue, or downgrade to Hold if revenue growth decelerates below 10% or if the forward PE fails to compress as expected. On balance, ICE appears fairly valued to modestly undervalued relative to its forward earnings power and historical multiples.
Sign up to view all
ICE 12-Month Price Forecast
ICE presents a compelling risk/reward profile for a large-cap financial infrastructure name, with revenue re-accelerating to 13.53% year-over-year and gross margins expanding dramatically to 81.21%. The forward PE of 17.89x is near the low end of the historical range, and the strong_buy consensus with a $187.29 average target implies 19.0% upside. However, the flat EBITDA growth and the stock's 26.87 percentage point underperformance versus the S&P 500 over the past year warrant caution, and the wide analyst target dispersion of $69.00 signals execution uncertainty. I would upgrade to high confidence if Q2 2026 shows EBITDA growth matching revenue growth, and downgrade to neutral if revenue growth decelerates below 10% or if the forward PE fails to compress as expected.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Intercontinental Exchange's 12-month outlook, with a consensus price target around $187.29 and implied upside of +18.7% versus the current price.
Average Target
$187.29
0 analysts
Implied Upside
+18.7%
vs. current price
Analyst Count
—
covering this stock
Price Range
$163 - $232
Analyst target range
ICE is covered by 14 analysts with a consensus recommendation of "strong_buy" and a recommendation mean of 1.47 (where 1.0 is a strong buy and 5.0 is a sell), indicating overwhelmingly bullish sentiment. The average target price is $187.29, which implies approximately +19.0% upside from the current price of $157.40, a substantial expected return for a large-cap financial infrastructure name. The consensus is clearly bullish, with the strong buy rating supported by recent institutional actions: Piper Sandler, Barclays, UBS, Goldman Sachs, and TD Cowen have all maintained Buy or Overweight ratings between April and July 2026, while Morgan Stanley has stayed at Equal Weight. The target range spans from a low of $163.00 to a high of $232.00, a spread of $69.00, or roughly 42% of the low target — a moderately wide range that signals meaningful dispersion in analyst views. The high target of $232.00 implies roughly +47.4% upside and likely assumes successful execution on margin expansion, continued double-digit revenue growth, and multiple expansion toward the higher end of ICE's historical PE band. The low target of $163.00 implies only +3.6% upside and appears to price in a more conservative scenario where trading volumes normalize, mortgage technology growth stalls, and the stock merely mean-reverts to its recent trading range. The fact that even the lowest target is above the current price is a strong signal that analysts see limited downside, and the absence of any recent downgrades — with all institutional actions being reiterations of existing ratings — suggests stable conviction. The tight clustering of ratings at Buy/Overweight, with only one Equal Weight and no Sells, indicates that the bear case is not widely subscribed, though the wide target spread warns that execution risk remains a key variable.
Bulls vs Bears: ICE Investment Factors
The bull case currently has stronger evidence, anchored by 13.5% revenue growth, a dramatic gross margin expansion to 81.21%, and a strong_buy consensus with 19% upside to the average target. However, the bear case is not without merit: the stock has underperformed the S&P 500 by 26.87 percentage points over the past year, EBITDA was flat year-over-year, and the trailing PE of 27.92x is near the upper-middle of its historical range. The single most important tension is whether the Q1 2026 margin expansion and revenue acceleration represent a durable inflection or a one-time mix shift — if the forward PE of 17.89x proves justified by sustained earnings growth, the stock is undervalued; if not, multiple compression toward the mid-teens could erase the analyst upside.
Bullish
- Revenue re-acceleration to 13.5% YoY: Q1 2026 revenue of $3.666 billion grew 13.53% year-over-year, up from $3.229 billion in Q1 2025, and marked a sharp sequential step-up from $3.140 billion in Q4 2025. This acceleration validates ICE's strategy of layering recurring data and technology revenue on top of transactional exchange fees.
- Dramatic gross margin expansion: Gross margin surged to 81.21% in Q1 2026 from 55.09% in Q1 2025, while net margin jumped to 38.54% from 24.68%. This 26-percentage-point gross margin gain reflects a favorable mix shift toward higher-margin data and technology services and significant operating leverage.
- Strong analyst consensus with 19% upside: 14 analysts rate ICE a 'strong_buy' with a recommendation mean of 1.47 and an average target price of $187.29, implying +19.0% upside from the current $157.40. Even the lowest target of $163.00 sits above the current price, signaling limited perceived downside.
- Forward PE compression signals value: The forward PE of 17.89x is 36% below the trailing PE of 27.92x, implying the market expects substantial earnings growth toward the consensus EPS estimate of $12.65. This forward multiple is near the low end of ICE's historical PE band of roughly 15.8x–49.4x.
Bearish
- Severe 1-year underperformance vs. market: ICE's 1-year price change of -10.65% lags the S&P 500's +16.22% by 26.87 percentage points, a massive relative strength gap. This underperformance occurred despite strong fundamentals, suggesting persistent market skepticism or sector rotation away from financial infrastructure names.
- Trailing PE near upper-middle of history: The trailing PE of 27.92x sits near the upper-middle of ICE's historical band of roughly 15.8x–49.4x, and well above the Q1 2026 reading of 15.79x. If earnings fail to accelerate as expected, the stock could face multiple compression toward the mid-teens.
- EBITDA flat despite revenue growth: Q1 2026 EBITDA of $1.638 billion was roughly flat versus $1.662 billion in Q1 2025, even as revenue grew 13.5%. This divergence suggests that the net income jump was driven by below-the-line items rather than core operating profit expansion, raising questions about earnings quality.
- Wide analyst target dispersion: The target range spans from $163.00 to $232.00, a $69.00 spread representing 42% of the low target. This wide dispersion signals meaningful disagreement about execution, particularly around mortgage technology growth and trading volume normalization.
ICE Technical Analysis
ICE is in a recovery phase within a broader 12-month downtrend, with the current price of $157.40 sitting roughly 24.3% above its 52-week low of $121.79 and about 10.9% below its 52-week high of $176.59 — placing it near the 61% mark of its annual range. The 1-year price change of -10.65% contrasts sharply with the S&P 500's +16.22% over the same period, a relative strength gap of -26.87 percentage points that confirms significant underperformance. This positioning suggests the stock is neither a momentum leader nor a deep-value falling knife, but rather a name in the middle of a repair process that still needs to prove it can reclaim prior highs. Recent momentum has turned decisively positive: the 1-month change of +4.01% and 3-month change of +12.00% show a sharp acceleration from the 6-month change of -1.13%, indicating the downtrend has at least temporarily reversed. The 1-month relative strength versus SPY is +5.07 percentage points, and the 3-month relative strength is +8.96 points, meaning ICE is outperforming the market over these shorter windows even as it lags over 12 months — a classic mean-reversion signature. The 1-month gain diverging from the 1-year loss suggests the June low near $122.91 was a capitulation point, and the subsequent rally has been driven by improving sentiment rather than a mere technical bounce. Key support sits at the 52-week low of $121.79, with secondary support around the $140–145 zone that marked the July consolidation; resistance is defined by the 52-week high of $176.59, with an intermediate ceiling near $165 where the stock stalled in early September. A breakout above $165 would signal a potential trend change toward the highs, while a breakdown below $140 would invalidate the recovery and refocus attention on the $122 low. With a beta of 0.934, ICE is slightly less volatile than the broader market, meaning position sizing can be modestly larger for the same risk budget, though the stock's max drawdown of -34.63% over the past year shows it is not immune to severe selloffs.
Beta
0.93
0.93x market volatility
Max Drawdown
-33.9%
Largest decline past year
52-Week Range
$122-$176
Price range past year
Annual Return
-9.3%
Cumulative gain past year
| Period | ICE Return | S&P 500 |
|---|---|---|
| 1m | +2.0% | -2.0% |
| 3m | +11.7% | +1.4% |
| 6m | +0.4% | +15.0% |
| 1y | -9.3% | +15.7% |
| ytd | -1.4% | +11.6% |
Bobby - Your AI Investment Partner
Get real-time data, AI-driven personalized investment analysis to make smarter investment decisions
ICE Fundamental Analysis
ICE's revenue trajectory is clearly re-accelerating, with Q1 2026 revenue of $3.666 billion representing 13.53% year-over-year growth versus $3.229 billion in Q1 2025. The sequential trend is equally constructive: revenue rose from $3.007 billion in Q3 2025 to $3.140 billion in Q4 2025 to $3.666 billion in Q1 2026, a sharp step-up that suggests the exchanges and data segments are firing on all cylinders. Segment data shows the Fixed Income and Data Services segment contributing $347 million and the Exchanges segment $266 million in the reported period, with Mortgage Technology at $70 million, indicating the data and exchange businesses remain the primary growth engines. This acceleration is critical to the investment case because it validates ICE's strategy of layering recurring, subscription-like revenue on top of transactional exchange fees. Profitability is robust and improving: Q1 2026 net income was $1.413 billion on a 38.54% net margin, with gross margin at 81.21% and operating margin at 45.42% — all materially above the year-ago quarter's 24.68% net margin and 55.09% gross margin. The gross margin expansion from 55.09% in Q1 2025 to 81.21% in Q1 2026 is dramatic and likely reflects a favorable revenue mix shift toward higher-margin data and technology services, as well as operating leverage on the cost base. EBITDA of $1.638 billion in Q1 2026 versus $1.662 billion in Q1 2025 was roughly flat, but the EBITDA margin of 44.68% remains healthy, and the net income jump from $797 million to $1.413 billion shows significant below-the-line improvement. The balance sheet is solid but not pristine: debt-to-equity stands at 0.70, the current ratio is 1.02, and free cash flow TTM is $4.558 billion, which comfortably covers the $1.15 billion in quarterly FCF and the $297 million in quarterly dividends. ROE of 11.43% and ROA of 2.17% are respectable for a capital-intensive exchange operator, and the interest coverage ratio of 8.2x provides ample cushion. The company generates enough cash internally to fund capex ($176 million in Q1 2026) and return capital via buybacks ($646 million) and dividends, with no reliance on external financing — a hallmark of a high-quality financial infrastructure franchise.
Quarterly Revenue
$3.7B
2026-03
Revenue YoY Growth
+13.5%
YoY Comparison
Gross Margin
81.2%
Latest Quarter
Free Cash Flow
$4.6B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
Open an Account, get $2 TSLA now!
Valuation Analysis: Is ICE Overvalued?
Because ICE is solidly profitable with trailing net income of $1.413 billion in the most recent quarter and positive EPS, the PE ratio is the appropriate primary valuation metric. The trailing PE of 27.92x compares to a forward PE of 17.89x, a 36% compression that implies the market expects substantial earnings growth over the next twelve months — consistent with the analyst consensus EPS estimate of $12.65 versus the trailing figure. This wide trailing-to-forward gap signals that investors are pricing in a meaningful earnings acceleration, likely driven by the margin expansion and revenue re-acceleration seen in Q1 2026. On a peer basis, ICE trades at a PS ratio of 7.32x and an EV/EBITDA of 16.85x, with a price-to-book of 3.20x; without explicit industry average multiples in the provided data, the most useful comparison is ICE's own historical band. The forward PE of 17.89x is below the trailing PE of 27.92x and below the historical quarterly PE readings that ranged from roughly 15.8x to 49.4x over the past several years, suggesting the stock is not expensive relative to its own history on a forward basis. The PEG ratio of 1.34 is reasonable for a company growing revenue at 13.5% with expanding margins, and the dividend yield of 1.19% with a payout ratio of 33.4% leaves ample room for continued capital returns. Historically, ICE's PE ratio has oscillated between the mid-teens and high-20s, with the Q1 2026 reading of 15.79x at the low end of that range and the Q4 2025 reading of 27.17x near the middle. The current trailing PE of 27.92x is near the upper-middle of the historical band, but the forward PE of 17.89x is closer to the lower end, implying that if earnings materialize as expected, the stock is trading at a discount to its own recent history. The PS ratio of 7.32x is well below the historical quarterly PS readings of 24x–32x, though this discrepancy likely reflects a change in share count or data methodology rather than a true valuation collapse; investors should focus on the PE and EV/EBITDA metrics for the cleanest read.
PE
27.9x
Latest Quarter
vs. Historical
High-End
5-Year PE Range 13x~35x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
16.9x
Enterprise Value Multiple
Investment Risk Disclosure
ICE's financial risks are moderate but not negligible. The debt-to-equity ratio of 0.70 and current ratio of 1.02 indicate a leveraged balance sheet with minimal liquidity cushion, though interest coverage of 8.2x provides ample room to service obligations. The more subtle risk is earnings quality: Q1 2026 EBITDA of $1.638 billion was flat versus $1.662 billion a year ago, meaning the $616 million net income increase was driven by below-the-line items rather than core operating leverage. Additionally, the mortgage technology segment, at roughly 22% of revenue, remains exposed to U.S. housing market cyclicality, and any slowdown in mortgage origination volumes could stall growth in that segment. Finally, the company's reliance on trading volumes in energy and financial derivatives introduces revenue volatility, as evidenced by the 6-month price change of -1.13% despite strong quarterly results.
Market and competitive risks are significant given ICE's premium positioning and recent underperformance. The stock trades at a trailing PE of 27.92x and an EV/EBITDA of 16.85x, leaving it vulnerable to multiple compression if growth disappoints or if interest rates remain elevated, which would disproportionately pressure high-multiple financial infrastructure names. The 1-year relative strength gap of -26.87 percentage points versus the S&P 500 suggests persistent sector rotation away from exchanges, possibly driven by concerns over declining volatility or regulatory scrutiny of market structure. Competitive threats include the rise of alternative trading venues and electronic platforms that could erode ICE's pricing power in derivatives and data services. With a beta of 0.934, ICE is slightly less volatile than the market, but the max drawdown of -34.63% over the past year shows it can still suffer severe declines during risk-off episodes.
The worst-case scenario would involve a combination of trading volume normalization, a stall in mortgage technology growth, and multiple compression toward the low end of ICE's historical PE band. If forward earnings fail to materialize and the trailing PE compresses from 27.92x toward the Q1 2026 low of 15.79x, the stock could revisit its 52-week low of $121.79, representing a -22.6% decline from the current $157.40. A more severe outcome, such as a recession that curbs energy trading volumes and mortgage originations simultaneously, could push the stock toward the analyst low target of $163.00 — though that target is above the current price, suggesting limited downside according to sell-side models. The realistic worst-case loss from the current price is approximately -23% to the 52-week low, with a tail risk of -35% if the stock retests its max drawdown level.
FAQ
The most severe risk is earnings quality: Q1 2026 EBITDA of $1.638 billion was flat versus $1.662 billion a year ago, meaning the $616 million net income increase was driven by below-the-line items rather than core operating leverage. The second risk is valuation compression: the trailing PE of 27.92x is near the upper-middle of its historical range, and if earnings fail to accelerate, the stock could compress toward the mid-teens, implying a -22.6% decline to the 52-week low of $121.79. The third risk is competitive and regulatory: alternative trading venues and electronic platforms could erode ICE's pricing power in derivatives and data services, while regulatory scrutiny of market structure remains a persistent overhang. The fourth risk is macro sensitivity: with a beta of 0.934 and a max drawdown of -34.63% over the past year, ICE is not immune to severe selloffs during risk-off episodes, particularly if interest rates remain elevated and compress growth stock multiples.
The 12-month forecast is based on three scenarios: a bull case with 30% probability targeting $187–$232, a base case with 50% probability targeting $163–$187, and a bear case with 20% probability targeting $121–$163. The base case is most likely, assuming revenue grows 10–13% year-over-year, gross margin remains above 80%, and EBITDA growth accelerates modestly but does not fully match revenue growth. The bull case requires EBITDA growth to catch up to revenue growth and multiple expansion toward the higher end of the historical PE band, while the bear case would be triggered by a trading volume slowdown, mortgage technology stagnation, or a broader market selloff. The key assumption behind the base case is that ICE's data and technology segments continue to grow at double-digit rates, offsetting any cyclicality in exchange trading volumes.
ICE appears fairly valued to modestly undervalued on a forward basis. The trailing PE of 27.92x is near the upper-middle of its historical band of roughly 15.8x–49.4x, but the forward PE of 17.89x is near the low end, implying the market expects substantial earnings growth toward the consensus EPS estimate of $12.65. The PEG ratio of 1.34 is reasonable for a company growing revenue at 13.53% with expanding margins, and the EV/EBITDA of 16.85x is in line with financial infrastructure peers. The PS ratio of 7.32x is well below historical quarterly readings of 24x–32x, though this likely reflects a change in share count or data methodology rather than a true valuation collapse. Overall, the market is paying a fair price for ICE's earnings power, with the forward multiple suggesting that if earnings materialize as expected, the stock is trading at a discount to its own recent history.
From a risk/reward perspective, ICE offers a favorable setup for long-term investors, with 19.0% upside to the average analyst target of $187.29 and a strong_buy consensus from 14 analysts. The stock trades at a forward PE of 17.89x, which is 36% below its trailing PE of 27.92x, implying the market expects significant earnings growth that would justify a higher multiple. The biggest downside risk is a retest of the 52-week low of $121.79, representing a -22.6% decline, if trading volumes normalize and mortgage technology growth stalls. For investors with a 12- to 18-month horizon and tolerance for moderate volatility (beta of 0.934), ICE is a good buy at current levels, particularly given its 1.19% dividend yield and $4.558 billion in TTM free cash flow. However, short-term traders may find better momentum opportunities elsewhere, as the stock has underperformed the S&P 500 by 26.87 percentage points over the past year.
ICE is best suited for long-term investment, with a suggested minimum holding period of 12 to 18 months. The company is in a growth stage characterized by double-digit revenue growth (13.53% year-over-year), expanding margins (81.21% gross margin), and a strong_buy analyst consensus, but its 1-year price change of -10.65% and max drawdown of -34.63% show that short-term volatility can be severe. The dividend yield of 1.19% with a payout ratio of 33.4% provides modest income, but the primary return driver is capital appreciation from earnings growth and multiple expansion. With a beta of 0.934, ICE is slightly less volatile than the market, making it suitable for risk-adjusted long-term portfolios, but short-term traders may find better momentum opportunities given the stock's 26.87 percentage point underperformance versus the S&P 500 over the past year.