{"id":25824,"date":"2023-06-22T03:07:08","date_gmt":"2023-06-22T07:07:08","guid":{"rendered":"https:\/\/ifintechworld.com\/news\/intercontinental-exchange-stock-nyse-owner-held-back-by-high-valuation-nyseice\/"},"modified":"2023-06-22T03:07:10","modified_gmt":"2023-06-22T07:07:10","slug":"intercontinental-exchange-stock-nyse-owner-held-back-by-high-valuation-nyseice","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=25824","title":{"rendered":"Intercontinental Exchange Stock: NYSE Owner Held Back By High Valuation (NYSE:ICE)"},"content":{"rendered":"
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New York Stock Exchange<\/p>\n<\/figcaption><\/figure>\n<\/p>\n

Summary.<\/h2>\n

Not long ago, I posed the question.. how can an investor own a piece of the financial exchanges themselves, and that led to my first analysis covering a major owner of derivatives exchanges, Chicago’s CME Group (<\/span>CME), one I have personally visited in Chicago’s financial district, along with options exchange operator CBOE Global Markets (<\/span>CBOE).<\/span><\/p>\n

Continuing on the theme of exchange operators, today I am rating the NYSE’s owner, Intercontinental Exchange<\/strong> (NYSE:ICE<\/span>).<\/p>\n

This stock is getting a Hold rating.<\/strong><\/p>\n

Its strengths are a solid cash position, revenue diversification, and stable dividend growth for the dividend investor.<\/p>\n

Its headwinds are overvaluation, and potential macro risks of a looming recession that could affect trading volumes in general as investors hold on to cash in that scenario, causing less transaction volume for the exchanges.<\/p>\n

Company Brief.<\/h2>\n

ICE crosses the spectrum of data, technology, and financial markets. According to <\/span>Wikipedia<\/em>, the company has 12 regulated exchanges & marketplaces, including the <\/span>New York Stock Exchange,<\/em> which it acquired in 2013.<\/span><\/p>\n

Besides operating stock exchanges, they also have a mortgage technology segment and a fixed income & data services segment.<\/p>\n

On the data side, one notable solution the company offers is to “enhance risk management, maintain compliance and maximize operational efficiency with high-quality reference data on over 35 million financial instruments covering more than 210 markets.”<\/p>\n

This ability to make a business out of mountains of data flowing through exchanges also sets them apart, which is why I mention it.<\/p>\n

Rating Methodology.<\/h2>\n

Albert Anthony & Co<\/em> is an equities research & analysis firm I run remotely, and the approach to research analysis we use on Seeking Alpha is to find stocks trading cheaply but who otherwise have strong financial fundamentals, and we primarily cover the financial & technology sectors.<\/p>\n

I ask the following 5 questions, and each yes answer is worth 20 points. A total score below 60 is a sell, a 60 is a hold, and above 60 is a buy.<\/p>\n