Pali Research Initiates Coverage on IntercontinentalExchange (ICE) with a Sell
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Pali Research initiates coverage on IntercontinentalExchange (NYSE: ICE) with a Sell. Price target $60.
Pali analyst says, "Continued economic weakness a worry for volume trajectory. Given strong historical relationships between economic activity and energy trading activity (with r-squared’s in the 75-93% range), we worry that ongoing economic weakness will take the wind out of the sales of energy volumes. A higher concentration of commercial customers has helped energy (54% of ICE’s revenues) hold up better than other asset classes, but we expect lower prices and the economic environment to drive lower trading activity moving forward...Valuation – credit for long-term opportunities, but not reflecting near-term challenges. After a 49% run since the beginning of March, ICE is trading at 20x/17x our 2009/2010 EPS estimates. Current valuations appear to be pricing in benefits from long-term opportunities such as CDS without reflecting the risks of declining trading volumes in the near-term. Given our cautious fundamental outlook, we believe there could be meaningful downside in the stock in the near-term."
To see more analyst ratings on ICE Click Here.
IntercontinentalExchange, Inc. (ICE) is an operator of regulated global futures exchanges and over-the-counter (OTC) markets.
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ICE predictions
mike hunt on Mar 30, 2009 01:35 PMyou cost me 200 grand by telling this shit about a company and industry you have never worked in or know nothing about. screw you, the last thing the world needs is negativity from doom mongers on a journalists salary. how can yo say this when the stock was $190 18 months ago, it will return muppets.