FOR PROFESSIONAL RESEARCH WRITER ONLY

2-3 page essay on The New York Stock Exchange. No Plagiarism. Due Date Firm 11/01/20 

160
120
100
80
60
50
40
30

20
15

5-for-1

Percent
shares
traded

60
40
20

E

Target Price Range
2023 2024 2025

INTERCONTNL. EXCH. NYSE-ICE 101.23 22.6 23.220.0 1.08 1.2%
TIMELINESS 1 Raised 6/19/20
SAFETY 2 Raised 7/17/15
TECHNICAL 3 Lowered 10/9/20
BETA .90 (1.00 = Market)

18-Month Target Price Range
Low-High Midpoint (% to Mid)

$79-$162 $121 (20%)

2023-25 PROJECTIONS
Ann’l Total

Price Gain Return
High 140 (+40%) 10%
Low 100 (Nil) 1%
Institutional Decisions

4Q2019 1Q2020 2Q2020
to Buy 519 506 536
to Sell 374 465 428
Hld’s(000) 505244 482374 476284

High: 24.4 25.9 27.1 28.5 45.4 45.9 53.3 59.9 73.0 82.6 95.6 107.0
Low: 10.0 18.4 20.5 22.1 24.8 36.5 40.4 45.4 55.8 66.9 71.2 63.5

% TOT. RETURN 8/20
THIS VL ARITH.*

STOCK INDEX
1 yr. 15.2 8.7
3 yr. 70.7 17.6
5 yr. 147.9 45.6

CAPITAL STRUCTURE as of 6/30/20
Total Debt $8408.0 mill. Due 5 Yrs $3500.0 mill.
LT Debt $7703.0 mill. LT Interest $260.0 mill.
(LT int. earned: 14.7x)

(31% of Cap’l)

Leases, Uncapitalized Annual rentals $62.0 mill.
No Defined Benefit Pension Plan

Pfd Stock None
Common Stock 543,276,671 shs.
as of 7/27/20

MARKET CAP: $55.0 billion (Large Cap)
CURRENT POSITION 2018 2019 6/30/20

($MILL.)
Cash Assets 724 841 880
Receivables 953 988 993
Other 65015 66150 95562
Current Assets 66692 67979 97435
Accts Payable 521 505 520
Debt Due 951 2569 705
Other 64636 65742 94968
Current Liab. 66108 68816 96193

ANNUAL RATES Past Past Est’d ’17-’19
of change (per sh) 10 Yrs. 5 Yrs. to ’23-’25
Revenues 14.5% 15.5% 7.5%
‘‘Cash Flow’’ 16.0% 19.0% 8.5%
Earnings 16.0% 15.5% 9.5%
Dividends – – 34.5% 6.5%
Book Value 18.0% 10.0% 8.0%

Cal- Full
endar Year

QUARTERLY REVENUES ($ mill.) F
Mar.31 Jun. 30 Sep. 30 Dec. 31

2017 1164 1178 1143 1144 4629
2018 1225 1246 1200 1308 4979
2019 1270 1298 1336 1298 5202
2020 1559 1395 1460 1431 5845
2021 1575 1525 1520 1520 6140
Cal- Full

endar Year
EARNINGS PER SHARE A

Mar.31 Jun.30 Sep.30 Dec.31
2017 .74 .75 .73 .73 2.95
2018 .90 .90 .85 .94 3.59
2019 .92 .94 1.06 .95 3.88
2020 1.28 1.07 1.10 1.00 4.45
2021 1.30 1.10 1.15 1.05 4.60
Cal- Full

endar Year
QUARTERLY DIVIDENDS PAID G

Mar.31 Jun.30 Sep.30 Dec.31
2016 .17 .17 .17 .17 .68
2017 .20 .20 .20 .20 .80
2018 .24 .24 .24 .24 .96
2019 .275 .275 .275 .275 1.10
2020 .30 .30 .30

2004D 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
.41 .56 1.08 1.65 2.25 2.71 3.14 3.67 3.76 2.91 5.47 5.61 7.56 7.77
.15 .24 .54 .78 1.00 1.16 1.42 1.77 1.88 1.40 2.31 2.68 3.82 3.84
.08 d.04 .48 .68 .83 .85 1.07 1.38 1.50 1.63 1.93 2.43 2.78 2.95
– – – – – – – – – – – – – – – – – – .13 .52 .58 .68 .80

.01 .03 .04 .09 .08 .07 .06 .16 .09 .24 .30 .32 .42 .37

.57 .84 1.56 4.24 5.54 6.53 7.58 8.62 10.05 21.88 21.88 24.89 26.42 28.40
264.33 277.56 290.63 348.56 361.82 367.45 366.52 362.13 362.37 575.00 565.00 595.00 595.00 596.00

– – – – 28.8 43.9 26.6 21.1 20.5 17.5 17.3 21.6 21.1 19.3 18.8 21.5
– – – – 1.55 2.33 1.60 1.41 1.30 1.10 1.10 1.21 1.11 .97 .99 1.08
– – – – – – – – – – – – – – – – – – .4% 1.3% 1.2% 1.3% 1.3%

1149.9 1327.5 1363.0 1674.0 3092.0 3338.0 4499.0 4629.0
67.3% 69.7% 70.3% 66.9% 61.8% 66.1% 70.3% 69.7%
121.2 132.3 130.5 161.0 202.0 234.0 610.0 535.0
398.3 509.7 551.6 646.0 1104.0 1359.0 1665.0 1752.0

33.2% 31.3% 28.9% 27.3% 30.2% 27.2% 29.9% 30.3%
34.6% 38.4% 40.5% 38.6% 35.7% 40.7% 37.0% 37.8%
448.4 805.1 1504.4 d83.0 d294.0 d1430 d1484 d609.0
325.8 837.5 969.5 3923.0 2247.0 4717.0 3871.0 4267.0

2777.6 3121.5 3643.4 12583 12360 14808 15717 16924
13.3% 13.3% 12.4% 4.1% 7.9% 7.2% 9.0% 8.7%
14.3% 16.3% 15.1% 5.1% 8.9% 9.2% 10.6% 10.4%
14.3% 16.3% 15.1% 4.5% 6.5% 6.9% 8.0% 7.5%

– – – – – – 12% 27% 24% 25% 27%

2018 2019 2020 2021 © VALUE LINE PUB. LLC 23-25
8.75 8.61 10.80 11.35 Revenues per sh F 12.95
4.68 4.73 5.75 5.95 ‘‘Cash Flow’’ per sh 7.30
3.59 3.88 4.45 4.60 Earnings per sh A 6.00
.96 1.10 1.20 1.24 Div’ds Decl’d per sh G 1.40
.24 .25 .25 .25 Cap’l Spending per sh .40

30.23 28.57 33.05 34.95 Book Value per sh B 46.30
569.00 604.00 540.00 540.00 Common Shs Outst’g C 540.00

20.7 22.0 Bold figures are
Value Line
estimates

Avg Ann’l P/E Ratio 20.0
1.12 1.19 Relative P/E Ratio 1.10

1.3% 1.3% Avg Ann’l Div’d Yield 1.2%

4979.0 5202.0 5845 6140 Revenues ($mill) F 7000
70.2% 71.0% 71.0% 72.0% Operating Margin 72.5%
586.0 662.0 675 685 Depreciation ($mill) 700

2077.0 2194.0 2425 2500 Net Profit ($mill) 3240
22.9% 21.7% 22.5% 22.5% Income Tax Rate 24.0%
41.7% 42.2% 41.5% 40.7% Net Profit Margin 50.8%
584.0 d837.0 120 360 Working Cap’l ($mill) 225

6490.0 5250.0 13250 13000 Long-Term Debt ($mill) 10000
17201 17255 17850 18875 Shr. Equity ($mill) 25000
9.3% 10.4% 8.0% 8.0% Return on Total Cap’l 9.5%

12.1% 12.7% 13.5% 13.0% Return on Shr. Equity 13.0%
8.8% 9.1% 10.0% 9.5% Retained to Com Eq 10.0%
27% 28% 27% 27% All Div’ds to Net Prof 23%

Company’s Financial Strength A
Stock’s Price Stability 95
Price Growth Persistence 90
Earnings Predictability 100

(A) Based on diluted shares. Excl. discontinued
operations: ’05, ($0.18). Earnings may not sum
due to changes in share count or rounding.
Next earnings report due early November.

(B) Incl. intangibles. In ’19: $23.6 bill.;
$39.07/share. (C) In millions, adj. for split.
(D) 2004 data is pro forma.
(E) Acq. NYSE Euronext 11/13/13.

(F) Rev. are net of transaction-based ex-
penses.
(G) Initiated quarterly dividend 12/12/13. Divd’s
historically paid late Mar., Jun., Sept., and Dec.

BUSINESS: Intercontinental Exchange, Inc. (ICE) owns and opera-
tes the leading global, electronic marketplace for trading both fu-
tures and over-the-counter (OTC) energy contracts and the leading
soft commodity exchange. Owns ICE Data, ICE Markets, ICE Fu-
tures, and IntercontinentalExchange Technologies. Also offers risk
management and trading support services, incl. cleared OTC con-

tracts, ETC confirmations, and energy market data. Acq. NYBOT
1/07 and NYSE Euronext, 11/13. Has 5,989 employees. Off./dir.
own 1.5% of stock; Vanguard, 7.8%; BlackRock, 7.1%; T. Rowe
Price, 5.1% (3/20 proxy). Inc.: DE. Pres.: Benjamin R. Jackson.
Chair/CEO: Jeffrey C. Sprecher. Addr.: 5660 New Northside Drive,
Atlanta, GA 30328. Tel.: 770-857-4700. Internet: www.theice.com.

Intercontinental Exchange put in a
strong performance for the second
quarter. Despite a difficult operating
backdrop, due to coronavirus and economic
headwinds, earnings per share advanced
14%, on a 7% revenue gain during the
June period.
The exchange operator should put in
a solid showing in 2020. Ongoing ex-
pense controls, and other business invest-
ments, including recent acquisitions, ought
to bolster its near-term prospects. The top
and bottom lines will probably climb 10%-
15% and 15%, respectively, this year. Next
year, we expect revenues and earnings will
increase at a low single-digit clip.
The Ellie Mae acquisition ought to
contribute nicely to results in the
back half of the year. In September, In-
tercontinental purchased Ellie Mae from
private equity company Thoma Bravo for
roughly $11 billion. The addition of the
cloud-based platform provider for the
mortgage finance industry helps ICE wid-
en its footprint into a new market
category. We envision the company will
also integrate the technologies into its
other platforms.

And other strategic business improve-
ments should set the stage for the
long haul. The company has been focus-
ing on technological investments and prod-
uct innovation. It has launched several
new products and services, and will proba-
bly work to better cater to its customers’
needs, as they adapt to the market envi-
ronment.
The company has been raising debt to
fund recent initiatives. In August, it
issued $6.5 billion in senior notes. It used
the majority of the proceeds to finance the
Ellie Mae acquisition. And it may use cash
on hand to fund other business initiatives,
as well as returning cash to shareholders
through dividends and share buybacks (it
repurchased $1.1 billion in common stock
through the end of the June quarter).
These shares are ranked to out-
perform the broader market averages
in the year ahead. However, thanks to
the stock’s recent momentum, it is now
trading near the low end of our 2023-2025
Target Price Range, thereby limiting much
of its capital appreciation potential over
the long haul.
Orly Seidman October 9, 2020

LEGENDS
18.0 x ″Cash Flow″ p sh

. . . . Relative Price Strength
5-for-1 split 11/16
Options: Yes
Shaded area indicates recession

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