Barclays Maintains an 'Overweight' on IntercontinentalExchange (ICE); Life after Liffe
Tweet
Share
E-mailGet Alerts ICE Hot Sheet
Price: $159.25 +1.28%
Rating Summary:
23 Buy, 5 Hold, 0 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 10 | Down: 12 | New: 20
Rating Summary:
23 Buy, 5 Hold, 0 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 10 | Down: 12 | New: 20
Join SI Premium – FREE
Barclays maintains an 'Overweight' on IntercontinentalExchange (NYSE: ICE), PT $152.
Barclays analyst says, "Since ICE had its attempt to purchase NYX's Liffe businesses spurned in mid-May, the company has continued to seek new avenues of growth, primarily by increasing the company's exposure in Brazil. ICE initially gained entry to the market through ICE Futures U.S., which market participants use to hedge soft commodity exposure (coffee, sugar, cotton). Earlier this year, ICE gained approval to distribute screens in Brazil to provide access to ICE's Brent crude contract...From a financial standpoint, we find the transaction to have minimal impact to our 2011 EPS estimate for ICE. Under the terms of the agreement, ICE purchased 31.6m shares of Cetip for $512m. ICE will use $302m in cash on hand and $210m in cash drawn from ICE's credit facilities. We estimate the impact of the purchase to be roughly 2 cents in EPS in 2011. However, we expect dividends to roughly offset the interest impact of the transaction, leaving our estimate unchanged for the time being. As we have written, we consider ICE to be one of the few (if only) remaining growth companies in the exchange space. Given ICE's growth bent, we expect ICE to continue to use cash to finance deals similar to this, rather than returning cash to shareholders."
For more ratings news on IntercontinentalExchange click here and for the rating history of IntercontinentalExchange click here.
Shares of IntercontinentalExchange closed at $127.50 yesterday.
Barclays analyst says, "Since ICE had its attempt to purchase NYX's Liffe businesses spurned in mid-May, the company has continued to seek new avenues of growth, primarily by increasing the company's exposure in Brazil. ICE initially gained entry to the market through ICE Futures U.S., which market participants use to hedge soft commodity exposure (coffee, sugar, cotton). Earlier this year, ICE gained approval to distribute screens in Brazil to provide access to ICE's Brent crude contract...From a financial standpoint, we find the transaction to have minimal impact to our 2011 EPS estimate for ICE. Under the terms of the agreement, ICE purchased 31.6m shares of Cetip for $512m. ICE will use $302m in cash on hand and $210m in cash drawn from ICE's credit facilities. We estimate the impact of the purchase to be roughly 2 cents in EPS in 2011. However, we expect dividends to roughly offset the interest impact of the transaction, leaving our estimate unchanged for the time being. As we have written, we consider ICE to be one of the few (if only) remaining growth companies in the exchange space. Given ICE's growth bent, we expect ICE to continue to use cash to finance deals similar to this, rather than returning cash to shareholders."
For more ratings news on IntercontinentalExchange click here and for the rating history of IntercontinentalExchange click here.
Shares of IntercontinentalExchange closed at $127.50 yesterday.
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- ICE sugar markets reach record open interest, surpassing 2010 high
- SentinelOne Inc (S) PT Raised to $26 at Cantor Fitzgerald Following Strong Q2 Checks
- Marti Technologies (MRT) PT Raised to $6 at Benchmark on Stronger Growth, Improved Earnings Visibility
Create E-mail Alert Related Categories
Analyst CommentsRelated Entities
Barclays, Dividend, Crude OilSign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!
