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Intercontinental Exchange (ICE) Q3 & September Volumes Up Y/Y

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·3-min read
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Intercontinental Exchange, Inc. ICE reported solid average daily volume (ADV) for the third quarter and September 2021. Average daily volume of 5.8 million contracts per day increased 17.8% year over year in the third quarter due to higher volumes in Commodities as well as Financials. There were 64 trading days in the third quarter of this year.

Agriculture and Metals ADV of 0.4 million contracts increased 0.8%. Energy volume increased 22.8% to 3.1 million contracts per day. Commodities ADV increased 20% to 3.5 million in the third quarter.

Interest rate volume increased 17.9% to 1.9 million contracts per day. Equity Index volume increased 3.3% to 0.4 million contracts. Foreign exchange volume decreased 12.5% to nearly 0.03 million contracts. Financials ADV increased 14.6% to 2.3 million in the third quarter.

Intercontinental Exchange develops and offers an array of products along with a broad range of risk management services including trade execution, market data, and pre- and post-trade processing and clearing services on an integrated platform. Its volume growth continues to drive Trading and Clearing revenues.

The company is well poised to capitalize on the accelerated digitization taking place in the U.S. residential mortgage industry. It has the largest mortgage network in the United States. The integration of Ellie Mae into ICE Mortgage Technology is likely to help the company in boosting its mortgage business.

Concurrently, Intercontinental Exchange reported ADV of 6.8 million contracts for September, up 11.2%, attributable to higher volumes in Commodities as well as Financials.

Energy volume exhibited improvement while Agriculture and Metals ADV declined. Interest rate volume and Equity Index volume increased year over year whereas foreign exchange volume declined year over year.

Guidance

Intercontinental Exchange also updated its expense guidance for the third quarter of 2021. The company now expects adjusted operating expenses related to Bakkt to be around $40 million. GAAP non-operating expenses are expected to be in the range of $47 million to $52 million. Adjusted non-operating expenses are estimated in the range of $72 million to $77 million to account for a $30 million dividend related to our investment in Euroclear and FX.

Price Performance

Shares of this Zacks Rank #4 (Sell) company have rallied 17.1% compared with the industry’s increase of 26.8%. The company’s compelling product portfolio, along with a broad range of risk management services, strategic buyouts and a robust capital position will likely help the stock bounce back.

Zacks Investment Research
Zacks Investment Research

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September Volumes of Other Securities Exchanges

Recently, securities exchanges, namely CME Group Inc. CME and MarketAxess Holdings Ltd. MKTX also posted their respective September 2021 volumes.

While MarketAxess reported monthly trading volume for September 2021 of $559.5 billion, consisting of $215 billion in credit volume and $344.5 billion in rates volume, CME Group reported ADV for September 2021 of 18.8 million contracts per day, up 11% year over year, attributable to higher volumes in two of the six product lines.

Key Pick

A better-ranked stock from the same space is OTC Markets Group OTCM, sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

OTC Markets Group delivered 47.50% earnings surprise in the last reported quarter.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Intercontinental Exchange Inc. (ICE) : Free Stock Analysis Report

CME Group Inc. (CME) : Free Stock Analysis Report

MarketAxess Holdings Inc. (MKTX) : Free Stock Analysis Report

OTC Markets Group Inc. (OTCM) : Free Stock Analysis Report

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