Is Interactive Brokers overvalued?
 | By Rifka Kats | Macroaxis Story |
Interactive Brokers currently has a performance score of 14 out of 100. Its market volatility, or Beta, is just 0.11, indicating that its stock price doesn't fluctuate much compared to the broader market. When the market rises, Interactive Brokers' gains are likely to be smaller, but in a downturn, its losses should also be less severe. To better understand the stock's potential, consider exploring its potential upside and examining the relationship between its kurtosis and typical daily price. This analysis can help you decide if Interactive Brokers' current trends might change direction.
Main Points
Interactive Brokers Group (NASDAQ: IBKR) is catching the eye of savvy investors as it stands out in the bustling capital markets sector. With a robust market capitalization of 78.3B and a net income from continuing operations of 2.8B, the company showcases a solid financial foundation. Despite a recent price change of -1.95, which might seem concerning at first glance, this dip could present a strategic entry point for those looking to capitalize on potential future gains. The company's enterprise value to revenue ratio of 1.85 further underscores its efficient revenue generation relative to its valuation, making it a compelling consideration for investors seeking growth opportunities.Macroaxis uses a strict editorial review process to publish stories and blog posts. Our publishers support our company and may receive a small commission when the partner links or references are utilized. Commissions do not affect the opinions or evaluations of our editorial team. The information our editors and media partners deliver is confidential and licensed for your sole use as a Macroaxis user. We reserve all rights to the content of this article, and therefore copying or distributing this story in whole or in part is strictly prohibited.
Reviewed by Gabriel Shpitalnik
Buy low, sell high—it's the age-old mantra of savvy investors, and Interactive Brokers (NASDAQ: IBKR) might just be the ticket in today's bustling market. With a robust operating income of $3.6 billion and a profit margin of 14.12%, this company stands out in the capital markets industry. Despite the market's upward momentum, IBKR's stock is trading at a day typical price of $183.21, offering a potential upside given Wall Street's target price of $209.30. The analyst consensus is a strong buy, bolstered by a solid quarterly earnings growth of 7.1%. With a book value of $38.07 per share, Interactive Brokers presents a compelling case for investors seeking a blend of stability and growth potential. Currently, Interactive Brokers' net income per share remains relatively steady compared to last year. As of January 14, 2025, the company's capital expenditure to revenue ratio is expected to increase to 0.01, while the dividend yield might decrease by the same margin. With growing interest in the capital markets, it's a good time to evaluate Interactive Brokers Group. I'll delve into this stock and explore the latest sentiment among retail investors. Additionally, I'll discuss key factors influencing Interactive Brokers' offerings and how these might affect the company's prospects for active traders this year.The performance of Interactive Brokers Group in the marketplace will significantly impact your decision to invest in its stock. Revenue growth, profitability, competitive positioning, management quality, and industry trends can influence Interactive Brokers' stock prices. When investing in Interactive Brokers, there are several factors to consider and potential outcomes to expect. As a company performs well, its stock price may increase, allowing investors to benefit from price appreciation. However, Interactive Stock can experience significant price fluctuations due to market conditions, economic factors, industry trends, or company-specific news. This is why investing in stocks such as Interactive Brokers carries risks, including the potential for capital loss. Stock prices can decline, and investors may incur losses if they sell shares at a lower price than their initial investment.
And What about dividends?
A dividend is the distribution of a portion of Interactive Brokers earnings, decided and managed by the company's board of directors and paid to a class of its shareholders. Note, announcements of dividend payouts are generally accompanied by a proportional increase or decrease in a company's stock price. Interactive Brokers dividend payments follow a chronological order of events, and the associated dates are important to determine the shareholders who qualify for receiving the dividend payment. Interactive one year expected dividend income is about USD0.42 per share.
At this time, Interactive Brokers' Dividends Paid is relatively stable compared to the past year. As of 01/31/2025, Dividend Paid And Capex Coverage Ratio is likely to grow to 47.19, while Dividend Yield is likely to drop 0.01. | Last Reported | Projected for Next Year | ||
| Dividends Paid | 37.8 M | 55.4 M | |
| Dividend Yield | 0.01 | 0.01 | |
| Dividend Paid And Capex Coverage Ratio | 44.94 | 47.19 | |
| Dividend Payout Ratio | 0.08 | 0.08 |
Investing in dividend-paying stocks, such as Interactive Brokers Group is one of the few strategies that are good for long-term investment. Ex-dividend dates are significant because investors in Interactive Brokers must own a stock before its ex-dividend date to receive its next dividend.
This type of analysis is very useful when you want to generate a past dividend schedule and payout information for Interactive Brokers. Then that information in the form of graph and calendar can be used to fully explain how Du Pont dividends can provide a real clue to its valuation.How important is Interactive Brokers's Liquidity
Interactive Brokers financial leverage refers to using borrowed capital as a funding source to finance Interactive Brokers Group ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Interactive Brokers financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Financial leverage can amplify the potential profits to Interactive Brokers' owners, but it also increases the potential losses and risk of financial distress, including bankruptcy, if the firm cannot cover its debt costs. The degree of Interactive Brokers' financial leverage can be measured in several ways, including by ratios such as the debt-to-equity ratio (total debt / total equity), equity multiplier (total assets / total equity), or the debt ratio (total debt / total assets). Please check the breakdown between Interactive Brokers's total debt and its cash.
What do experts say about Interactive?
Stock analysis is a method for investors and traders to make buying and selling decisions. By studying and evaluating past and current data, investors and traders attempt to gain an edge in the markets by making informed decisions.
Analysis ConsensusA Deeper Perspective On Interactive Brokers
The asset utilization indicator refers to the revenue earned for every dollar of assets a company currently reports. Interactive Brokers has an asset utilization ratio of 3.44 percent. This connotes that the Company is making $0.0344 for each dollar of assets. An increasing asset utilization means that Interactive Brokers Group is more efficient with each dollar of assets it utilizes for everyday operations. Warren Buffett once said, "Be fearful when others are greedy and greedy when others are fearful." This sentiment rings true for Interactive Brokers Group (NASDAQ: IBKR), which stands out as a compelling buy even as the market climbs. With a robust market capitalization of $78.26 billion and a healthy operating income of $3.6 billion, the company is well-positioned within the capital markets industry. Despite a high PEG ratio of 13.10, indicating potential overvaluation, the firm's strong cash flow from operations at $4.54 billion suggests solid financial health. Investors might find the current price levels attractive, especially given the company's impressive earnings per share of 6.43, signaling potential for future growth.
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