Comments on: Interactive Brokers (IBKR) – Complexity Means No Coverage http://zachstocks.com/2007/12/interactive-brokers-ibkr-complexity-means-no-coverage/ Dynamic Investments for Exceptional Traders Tue, 31 Jan 2012 01:21:02 -0700 http://wordpress.org/?v=2.8.6 hourly 1 By: Zach http://zachstocks.com/2007/12/interactive-brokers-ibkr-complexity-means-no-coverage/comment-page-1/#comment-3985 Zach Mon, 31 Dec 2007 14:35:14 +0000 http://zachstocks.com/2007/12/interactive-brokers-ibkr-complexity-means-no-coverage/#comment-3985 DAJ - good point... I think the leverage is there and it is just a matter of how much time it takes Wall Street to get past the confusing ownership structure and focus more closely on the earnings potential. Tony - I think it could have the effect of compressing margins somewhat, but also could allow IBKR to pick up volume to make up for that compression. Definitely something to watch closely. Thanks for the comments, ZDS DAJ – good point… I think the leverage is there and it is just a matter of how much time it takes Wall Street to get past the confusing ownership structure and focus more closely on the earnings potential.

Tony – I think it could have the effect of compressing margins somewhat, but also could allow IBKR to pick up volume to make up for that compression. Definitely something to watch closely.

Thanks for the comments,
ZDS

]]> By: Tony http://zachstocks.com/2007/12/interactive-brokers-ibkr-complexity-means-no-coverage/comment-page-1/#comment-3983 Tony Mon, 31 Dec 2007 14:13:53 +0000 http://zachstocks.com/2007/12/interactive-brokers-ibkr-complexity-means-no-coverage/#comment-3983 Are you worried about the penny pilot's effect on their business model? Are you worried about the penny pilot’s effect on their business model?

]]> By: DAJ http://zachstocks.com/2007/12/interactive-brokers-ibkr-complexity-means-no-coverage/comment-page-1/#comment-3981 DAJ Mon, 31 Dec 2007 05:59:22 +0000 http://zachstocks.com/2007/12/interactive-brokers-ibkr-complexity-means-no-coverage/#comment-3981 good stock -- you forgot to model the incredible operating leverage the firms enjoys when things are good and they can keep their retention rates going. Most of the costs are fixed, so the margins get nice and fat as the top line continues to propel forward. There is a tight institutional demand for the stock, given that there are only 40M shares out. In the last quarter (ending Sept 07), we saw fund ownership jump from 35 to 53 - a 51%increase!! The sell side is missing the 70% gross margin story and EPS in 08 is closer to 2 bucks, we think. The Street is modeling $1.68 good stock — you forgot to model the incredible operating leverage the firms enjoys when things are good and they can keep their retention rates going.

Most of the costs are fixed, so the margins get nice and fat as the top line continues to propel forward. There is a tight institutional demand for the stock, given that there are only 40M shares out.

In the last quarter (ending Sept 07), we saw fund ownership jump from 35 to 53 – a 51%increase!!

The sell side is missing the 70% gross margin story and EPS in 08 is closer to 2 bucks, we think. The Street is modeling $1.68

]]> By: Zach http://zachstocks.com/2007/12/interactive-brokers-ibkr-complexity-means-no-coverage/comment-page-1/#comment-3969 Zach Sat, 29 Dec 2007 14:44:38 +0000 http://zachstocks.com/2007/12/interactive-brokers-ibkr-complexity-means-no-coverage/#comment-3969 I definitely think it could continue to be a money making center for them - penny options will be a challenge but it might actually help the company as other market makers may quit competing. I'm also excited to see how successful they are in entering new international markets. There are a couple of exciting countries coming on line in 2008. I definitely think it could continue to be a money making center for them – penny options will be a challenge but it might actually help the company as other market makers may quit competing.

I’m also excited to see how successful they are in entering new international markets. There are a couple of exciting countries coming on line in 2008.

]]> By: Aaron http://zachstocks.com/2007/12/interactive-brokers-ibkr-complexity-means-no-coverage/comment-page-1/#comment-3967 Aaron Sat, 29 Dec 2007 01:08:03 +0000 http://zachstocks.com/2007/12/interactive-brokers-ibkr-complexity-means-no-coverage/#comment-3967 In this space, a competitive advantage is extremely important given the large amount of competition. If as you mention in the post, IBKR is very strong in the options market then that could certainly be a nice growth area for them to hang their hat on going forward. In this space, a competitive advantage is extremely important given the large amount of competition. If as you mention in the post, IBKR is very strong in the options market then that could certainly be a nice growth area for them to hang their hat on going forward.

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