Interactive Brokers Shares Fall on Shortfall, Analyst Reaction Mixed By

© Reuters. Shares of Interactive Brokers (IBKR) drop on shortfall, analyst reaction mixed

Shares of Interactive Brokers (NASDAQ:) are down 1.5% in premarket trading after the retail investment firm announced .

IBKR reported adjusted EPS of 82c, in line with consensus estimates. Adjusted net income was $692 million, missing the consensus projection of $701.6 million.

The total number of customer accounts was 1.81 million, just above the 1.8 million expected. Client margin loans were reported at $48.2 billion, below analyst estimates of $49.62 billion.

The group reported $355.9 billion in customer capital, in line with analysts’ estimates. Customer credit balances totaled $92.5 billion, while analysts were looking for $87.25 billion.

BofA analyst Craig Siegenthaler reiterated a buy rating and raised the price target to $117.00 per share from $111.00 after results showed strong organic growth momentum continued.

“We reiterate our buy rating as we expect consensus EPS estimates to rise (about 20% in 2024), its PE multiple (just 15x) and we expect revenue growth of about 20% in 2023- 24. IBKR also has visibility into several significant introducing broker wins that it plans to announce later in 2022,” Siegenthaler said in a client note.

The analyst considers IBKR to be “one of the fastest growing organic names in financial services given its wide range of products it offers globally.”

On the other hand, Goldman Sachs analyst Will Nance is more pessimistic as he reiterated a neutral rating and lowered the price target to $90.00 per share from $105.00.

“Management remains bullish on account growth in the 30% range, which, combined with the outlook for higher earnings versus rates, suggests an improving risk/reward ratio. That said, we remain neutral as we believe we need to see retail engagement levels flex/stabilize for equities to flex higher,” Nance said in a note to clients.

By Senad Karaahmetovic