Deutsche Bank Upgrades Intercontinental Exchange, Says Valuation Is 'More Reasonable'

In a report published Friday, Deutsche Bank analyst Brian Bedell upgraded the rating on Intercontinental Exchange Inc (NYSE: ICE) from Hold to Buy, while raising the price target from $247 to $252.Intercontinental Exchange's stock has underperformed the exchange group over the past eight months and commands a reasonable valuation at present. Analyst Brian Bedell believes that the company's shares can "appreciate near pace of EPS growth.""Moreover, energy futures volumes are proving more durable at lower crude oil prices amid elevated volatility, and we view our prior volume forecasts in energy as too conservative," Bedell added.International Exchange is a solid longer-term free cash flow story. In the report Deutsche Bank noted, "Exchange stocks can extend their 3Q gains," in view of the trends witnessed in 3Q so far wherein " volumes our outpacing our forecasts by >10% in many categories."Even if the Greece situation were to get resolved, uncertainty around a Fed liftoff "should also drive enough volatility for volumes in rate-based products, equity index products, and even cash equities to buck typically weak seasonal summer trends," the report stated.