P/L: +$655
Cost: $415
Sold: $1070

Sold Date: 11-07-08
Quantity: 1
Price: $540

Sold Date: 11-06-08
Quantity: 1
Price: $530


Buy Date: 11-05-08
PUT NOV08@75 Price:200
Quantity: 2
Stop Loss: $90.50
Limit Sell: $75.50

Buy Date:
PUT NOV08@75 Price:200
Quantity: 2
Stop Loss: $90.50
Limit Sell: $75.50

MY DCF MODEL YIELDED 165-180, INTRINSIC VALUE. GREAT GROWTH PROSPECTS AND AND EXPANDING POTFOLIO OF PRODUCTS. NOT TO MENTION A POSSIBLE CDS PLATFORM AND EUROPEAN CLEARING HOUSE = HIGHER MARGINS. CURRENT PRICE 64.60

Gartman says he's buying CME Group (CME) and the Intercontinental Exchange(ICE), but he's also hedging those buys by being short the stock market.

The CME Steps Up:
Dan Dicker discusses the highly positive announcement that the Chicago Mercantile Exchange is creating a market for toxic mortgage instruments.

Click here to watch the video.

ICE Is a leading operator of global exchanges and over-the-counter (OTC) markets with headquarters in Atlanta, GA. On Monday, August 4th, the company said it will repurchase up to $500 million in common stock over the next year. The buybacks will be financed through a mix of cash on hand, future cash flows and their existing credit line.

The company will begin repurchasing shares after it completes the acquisition of Creditex Group, a credit processor, in a deal worth $625 million.

Scott Hill, ICE’s CFO said, “This program reflects our belief that the current share price does not appropriately reflect the strong underlying fundamentals of our global business.”

ICE reported its second strongest quarter ever as oil prices surged to record highs. In the second quarter net income rose to $84.9 million, or $1.19 a share, a 58% jump from $53.7 million, or 75 cents a share, reported in the same period last year. The operator of Europe’s largest energy market said that revenue improved 44% to $197.2 million. ICE reported $58.1 million in contracts for its future exchanges, an increase of 18% from the year-ago period.

Jeffrey C. Sprecher, ICE Chairman and CEO commented, “ICE's strong second quarter performance demonstrates our team's continued focus on growth and execution.” He continued, “We continue to invest in new avenues of growth and to evaluate M&A opportunities to expand our position as one of the most global, diversified derivatives markets in the world.”

After shares sank 11% following the earnings report, Credit Suisse issued a note saying the selloff was unwarranted. Analyst Howard Chen said “We view 2Q results as healthy, believe growth outlook is intact and view yesterday’s 11%+ selloff in ICE shares as dramatically overdone. ICE is our top pick in the sector as we continue to see best-in-class organic growth in the franchise at valuations close to a S&P 500 market multiple (13x 2009 EPS).” They rate ICE outperform and have a $170 price target on the stock.

Still, has the pullback gone too far? At about 88, ICE shares fetch 13.5 times projected 2009 earnings. This, quite remarkably, is now on par with the valuation of Nasdaq OMX Group (NDAQ), a fine exchange that has made great strides with cost cuts and expansion but whose stocks can easily trade at rival markets -- unlike "non-fungible" derivatives that can only be bought and sold at the same futures market. The stock also trades at 17.6 times 2008 profits, compared with more than 20 times for specialized finance stocks. Sandler O'Neill analyst Richard Repetto argues that ICE faces comparable risks as other U.S. exchanges. Yet its stock has suffered bigger declines, even with better growth so far this year in transaction revenue, operating income and per-share earnings. To be sure, ICE may never see the staggering multiples it once commanded back when growth was unfettered and booming. But a pesky hurricane season could easily goose energy trading this fall and arrest the stock slide. So could mounting geopolitical tension surrounding Russia. Helping to put a floor under the stock is the company's recent plan to buy back $500 million worth of shares over the next 12 months, which Repetto estimates would cover more than 8% of diluted shares outstanding. His price target: $165.

ICE Is a leading operator of global exchanges and over-the-counter (OTC) markets with headquarters in Atlanta, GA. On Monday, August 4th, the company said it will repurchase up to $500 million in common stock over the next year. The buybacks will be financed through a mix of cash on hand, future cash flows and their existing credit line.

The company will begin repurchasing shares after it completes the acquisition of Creditex Group, a credit processor, in a deal worth $625 million.

Scott Hill, ICE’s CFO said, “This program reflects our belief that the current share price does not appropriately reflect the strong underlying fundamentals of our global business.”

ICE reported its second strongest quarter ever as oil prices surged to record highs. In the second quarter net income rose to $84.9 million, or $1.19 a share, a 58% jump from $53.7 million, or 75 cents a share, reported in the same period last year. The operator of Europe’s largest energy market said that revenue improved 44% to $197.2 million. ICE reported $58.1 million in contracts for its future exchanges, an increase of 18% from the year-ago period.

Jeffrey C. Sprecher, ICE Chairman and CEO commented, “ICE's strong second quarter performance demonstrates our team's continued focus on growth and execution.” He continued, “We continue to invest in new avenues of growth and to evaluate M&A opportunities to expand our position as one of the most global, diversified derivatives markets in the world.”

After shares sank 11% following the earnings report, Credit Suisse issued a note saying the selloff was unwarranted. Analyst Howard Chen said “We view 2Q results as healthy, believe growth outlook is intact and view yesterday’s 11%+ selloff in ICE shares as dramatically overdone. ICE is our top pick in the sector as we continue to see best-in-class organic growth in the franchise at valuations close to a S&P 500 market multiple (13x 2009 EPS).” They rate ICE outperform and have a $170 price target on the stock.

Derivatives exchange.

good managment, good fundamental, nice chart

Earnings may be hurt by coming regulation and an extended economic slowdown.

wild optimism

went up to fast, now in freefall

.84

I don't hate it ... has nice growth potential ... BUT have you investors looked at this company's P/E lately???

out of my reach

Goldman Sahcs lowered its position ot 5.6%. Morgan Stanley reduced their holdings to 4.29%.