Citigroup 'Cools' On Intercontinental Exchange, Downgrades To Neutral

Neil Stratton of Citigroup downgraded shares of

on Friday to Neutral from Buy despite raising his price target to $240 from a previous $226. Stratton notes that shares of Intercontinental Exchange appreciated approximately 17 percent quarter to date, outperforming its peers return at around 10 percent and the five percent appreciation in the S&P 500. The analyst adds that further upside is dependent on driving top line growth and while the company sees opportunities, shares have a balanced risk to reward profile. Stratton thinks that volume pressures could abate in 2015 while market data and listings businesses will drive year over year growth. And the company's clearing business should also grow. In addition, management's $1.65 billion capital return plans throughout 2015 provides further shareholder value. “While we do see opportunities to drive revenue ahead, Intercontinental Exchange's year-to-date under-performance is now less pronounced and the risk/reward is less attractive, in our view,” Stratton concluded.