Interactive Brokers reports strong March trading metrics

GREENWICH, Conn. - Interactive Brokers Group, Inc. (NASDAQ:IBKR), a global automated electronic broker with a market capitalization of nearly $70 billion, disclosed its monthly performance metrics for March, showcasing significant year-over-year growth despite a slight decline from the previous month. While the stock has faced headwinds in recent weeks according to InvestingPro data, the company maintains strong fundamentals with a "GREAT" financial health score of 3.2 out of 5.

The company’s Daily Average Revenue Trades (DARTs) for March stood at 3.471 million, marking a 44% increase compared to the same period last year, although this was a 4% decrease from February. Client equity at the end of March reached $573.5 billion, a 23% rise year-over-year, with a marginal 2% dip from the previous month. This growth aligns with the company’s impressive 17.7% revenue increase over the last twelve months. For deeper insights into IBKR’s performance metrics and growth trajectory, InvestingPro subscribers have access to over 30 additional financial indicators and expert analysis.

Margin loan balances for clients closed the month at $63.7 billion, staying relatively flat compared to February but representing a 24% hike from the prior year. Client credit balances, which include insured bank deposit sweeps, showed a 19% year-over-year increase to $125.2 billion and a 1% increase from February.

Interactive Brokers also reported a substantial 32% year-over-year increase in client accounts, totaling 3.62 million at the end of March, up 2% from the previous month. The actual growth in accounts was 87.7 thousand, with the discrepancy from the calculated change of 74.4 thousand accounts due to 13.3 thousand accounts being escheated to government authorities, as per legal requirements.

The brokerage highlighted an annualized average of 211 cleared DARTs per client account. Average commissions per cleared Commissionable Order, inclusive of exchange, clearing, and regulatory fees, were $2.85, with stocks, equity options, and futures at $2.17, $3.89, and $3.90 respectively.

Other financial information included a mark-to-market gain of $462,000 on the U.S. government securities portfolio for the quarter ended March 31st. The GLOBAL, a basket of 10 major currencies representing the company’s net worth, increased by 0.61% in March and 0.75% for the quarter.

IBKR PRO clients experienced an all-in cost of trade execution of approximately 3.3 basis points of trade money in March, benchmarked against a daily Volume Weighted Average Price (VWAP).

The performance metrics provided by Interactive Brokers offer insights into the company’s operations and client behavior, reflecting a positive trend in trading activity and client assets management. With the company’s next earnings report scheduled for April 15, investors are watching closely, as analysts maintain a bullish outlook with price targets ranging from $144 to $291. InvestingPro analysis suggests the stock is currently trading below its Fair Value, indicating potential upside opportunity. The company has also maintained consistent dividend payments for 16 consecutive years, demonstrating strong financial stability.

In other recent news, Interactive Brokers has introduced Forecast Contracts in Canada, allowing investors to speculate on various economic, political, and climate events. This expansion follows their availability in the U.S. and aims to meet the demand for predictive financial instruments. Additionally, Interactive Brokers has broadened its cryptocurrency offerings by adding Solana, Cardano, Ripple, and Dogecoin to its platform. This move allows clients to diversify their portfolios by trading both digital and traditional assets.

In another development, Interactive Brokers appointed Lori Conkling as an independent director. Conkling, who has extensive media industry experience, currently serves as Head of TV & Film Licensing at Netflix. The company also launched Nifty 50 Index Futures on the Singapore Exchange, providing traders with access to India’s market through a single, liquid instrument. Meanwhile, Barclays analysts have maintained their Overweight rating on Interactive Brokers, with a price target of $231.00, citing significant account growth and positive trading activity. Despite some declines in margin and client equity, the increase in cash balances suggests clients are holding more liquidity.

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