Intercontinental Exchange, Inc. ICE
Verdict: Sell. Fair value $148 against a price of $166 on 6 Jan 2026, 11% below the price.
In plain words
The case for: Wide competitive moat provides durability. Market leadership enables pricing power. Industry tailwinds with growing market.
The case against: Net Income shows extreme volatility ($4.06B in 2021, $1.45B in 2022, $2.75B in 2024) that is not.... In 2022, Net Income plummeted to $1.45B while OCF remained strong at $3.55B (OCF/NI Ratio of 2.46).....
Main risks
- Low and potentially inefficient capital allocation, with an estimated 3-year ROIIC of 9.6% and a current ROIC of 7.6%, suggesting recent investments are not generating high returns.
- High leverage with a Debt/EBITDA ratio of approximately 4.2x, which increases financial risk, especially if profitability falters.
- Significant Net Income volatility, with a sharp drop in 2022 from a 2021 high, raising questions about the consistency and quality of earnings despite strong revenue growth.
- Net Income shows extreme volatility ($4.06B in 2021, $1.45B in 2022, $2.75B in 2024) that is not...
- In 2022, Net Income plummeted to $1.45B while OCF remained strong at $3.55B (OCF/NI Ratio of 2.46)....
- Net Income shows extreme volatility ($4.06B in 2021, $1.45B in 2022, $2.75B in 2024) that is not reflected in the much more stable and growing Operating Cash Flow. This indicates significant non-cash, non-operating items are distorting reported profitability.