Interactive Brokers Group Inc (IBKR, Financial) has experienced a notable uptick in its stock performance, with a market capitalization now standing at $12.15 billion. The current price of $113.43 reflects a modest 0.01% gain over the past week and a significant 27.38% gain over the past three months. According to GuruFocus's valuation metrics, the stock is currently modestly undervalued with a GF Value of $130.2, up from a past GF Value of $91.08. This marks a shift from being fairly valued three months ago to its current state, suggesting potential for further growth.
Understanding Interactive Brokers Group Inc
Interactive Brokers Group Inc, operating within the capital markets industry, is a leading online brokerage firm. The company generates a significant portion of its revenue from trading commissions, which account for approximately 31% of net revenue. Net interest income is another major contributor, representing about 64% of net revenue, derived from idle client cash. Ancillary services add roughly 6% to the revenue stream, while principal trading and other activities make up about 5%. Interactive Brokers boasts a diverse international presence, with 70% of its net revenue coming from the U.S. and the remaining 30% from international markets. 
Profitability Analysis
Interactive Brokers Group Inc stands out in terms of profitability, with a Profitability Rank of 9/10. The company's operating margin is an impressive 83.92%, outperforming 91.05% of 659 companies in the industry. Its return on equity (ROE) is 18.77%, higher than 81.4% of its peers. Although the return on assets (ROA) is lower at 0.50%, it still surpasses 37.59% of 806 companies. The return on invested capital (ROIC) stands at a robust 25.44%, better than 87.7% of 683 companies. Interactive Brokers has maintained profitability for the past decade, a testament to its solid financial foundation. 
Growth Trajectory
The company's Growth Rank is at the maximum of 10/10. Interactive Brokers has seen a 34.80% 3-Year Revenue Growth Rate per Share, surpassing 83.24% of 686 companies in the industry. The 5-Year Revenue Growth Rate per Share is also strong at 15.20%. Looking ahead, the Total Revenue Growth Rate (Future 3Y To 5Y Est) is projected at 14.90%. Earnings per share (EPS) growth rates are equally impressive, with a 32.20% 3-Year EPS without NRI Growth Rate and a 21.00% 5-Year EPS without NRI Growth Rate. The EPS Growth Rate (Future 3Y To 5Y Est) is anticipated to be 15.55%. These figures underscore Interactive Brokers' robust growth prospects. 
Notable Shareholders
Interactive Brokers Group Inc has attracted the attention of several prominent investors. Ron Baron (Trades, Portfolio) leads the pack with 737,534 shares, representing a 0.69% stake in the company. George Soros (Trades, Portfolio) holds 254,713 shares, accounting for 0.24%, while Ray Dalio (Trades, Portfolio) owns 185,098 shares, translating to a 0.17% share percentage. These significant investments by well-known figures in the financial world highlight the company's strong investment appeal.
Competitive Landscape
When compared to its competitors, Interactive Brokers Group Inc holds a competitive edge with its $12.15 billion market cap. XP Inc (XP, Financial) follows closely with a market cap of $11.83 billion, while Jefferies Financial Group Inc (JEF, Financial) and Houlihan Lokey Inc (HLI, Financial) have market caps of $8.76 billion and $8.56 billion, respectively. This positioning reflects Interactive Brokers' strong market presence and potential for continued growth within the capital markets sector.
Conclusion
In summary, Interactive Brokers Group Inc's stock performance has been impressive, with a 27.38% gain over the past three months and a current valuation that suggests it is modestly undervalued. The company's solid profitability and exceptional growth rates, coupled with its strategic market position and business model, make it an attractive option for investors. The presence of notable shareholders further validates its investment potential. With a competitive market cap that stands out among its peers, Interactive Brokers Group Inc is well-positioned for future success in the capital markets industry.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
