Interactive Brokers Gains from Increase in Trading Activity - Analyst Blog
We have issued an updated research report on Interactive Brokers Group, Inc. IBKR on Jul 3, 2015. We believe the company will continue to benefit from renewed interest of retail investors in equity markets, as evident from improvement in trading volume and client trades.
Interactive Brokers’ position with respect to the interface of four broad historical trends is impressive. As part of its globalization efforts, the company processes trades in stocks, futures, options and forex on more than 100 exchanges across 24 countries and in 21 currencies. Also, owing to its technological excellence, the company incurs a lower level of compensation expense relative to net revenue.
Moreover, Interactive Brokers has been consistently exploring growth opportunities in the emerging markets of Taiwan, Mexico and India. More than 60% of its new customers are from outside the U.S., leading to a greater diversification of revenues.
Over the last 7 days, the Zacks Consensus Estimate for the stock remained unchanged at 68 cents per share for 2015. Nonetheless, for 2016, the Estimate grew 3.6% to $1.42 per share over the same time frame.
On the flip side, we remain concerned about intensifying market rivalry and increasing volatility hampering Interactive Brokers’ profitability in the near term. Also, dismal performance of Market Making segment may hurt the company’s dividend-paying ability, as the regular quarterly dividend will be paid from its Market Making segment.
Currently, Interactive Brokers carries a Zacks Rank #2 (Buy).
Other Stocks Worth Considering
Other investment brokers that are worth a look include Raymond James Financial, Inc. RJF, TD Ameritrade Holding Corporation AMTD and BGC Partners, Inc. BGCP. All three stocks hold the same Zacks Rank as Interactive Brokers.
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INTERACTIVE BRK (IBKR): Free Stock Analysis Report
BGC PARTNRS INC (BGCP): Free Stock Analysis Report
TD AMERITRADE (AMTD): Free Stock Analysis Report
RAYMOND JAS FIN (RJF): Free Stock Analysis Report
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