Interactive Brokers Stock Near Buy Point with Strong Growth Momentum

The stock market is alive with excitement today, and Interactive Brokers (IBKR) is stealing the spotlight as the Investment Business Daily (IBD) Stock of the Day. After a strong breakout last Tuesday, shares are hovering near a key buy point, drawing the attention of investors. Even with a recent dip in profit growth, this online brokerage is showing plenty of promise thanks to rising client numbers and fresh trading features. Let‘s break down what’s fueling this surge and what it means for folks watching the market today.

Steady Profits Despite a Slowdown

Interactive Brokers has seen its profit growth ease up a bit over the last few quarters, but it‘s still holding strong. The company’s earnings per share (EPS) have jumped by an average of 21.4% over the past three quarters, proving it can weather a slowdown. This solid performance earns IBKR one of the top EPS Ratings in IBDs investment banks and brokers category, thanks to a steady long-term profit growth of 35%.

Looking to 2025, experts predict a more modest 5% earnings bump after big gains of 42% and 22% in 2023 and 2024. Revenue is also expected to grow at a slower pace of 6% this year, down from 42% in 2023 and 20% in 2024. These figures show the company is shifting from a fast-growth phase to a more stable one, which could appeal to cautious investors.

Riding a Wave of Momentum

Dont let the slower growth fool you—Interactive Brokers is picking up speed in other areas. On May 2, the stock rose above its 50-day moving average, a sign that investors are feeling optimistic. This came after a solid April report and a vote of confidence from Goldman Sachs, which bumped its price target from $207 to $212 and kept its buy recommendation.

Goldman Sachs pointed to a 63% increase in Daily Average Revenue Trades compared to last year, with a 10% jump from March. The company also added 32% more client accounts, reaching 3.71 million, and saw a 3% rise from the previous month. Plus, app downloads and active users are beating the 2023-24 averages, showing more people are jumping on board.

Growing Tools and Global Appeal

Interactive Brokers is famous for its top-notch tools for active traders, and it‘s expanding its lineup. This month, the company rolled out 24-hour trading of Forecast Contracts, letting users bet on things like economic shifts or weather events. It’s a fresh way to keep traders engaged.

The brokerage also shines globally, serving folks in over 200 countries and territories, with 84% of its clients living outside the U.S., according to its latest Q1 SEC filing. With trading options in multiple foreign markets and currencies, IBKR is a go-to for international investors.

Big Moves with Stock Split and Dividend Hike

On April 15, Interactive Brokers announced a 4-for-1 stock split, set to kick in on June 18. This lowers the price per share, which might draw in more everyday investors. But some experts, like those at Investor‘s Business Daily, suggest big splits can sometimes mean management is overly hopeful about the near future—so it’s worth a second look.

The company also sweetened the deal by raising its quarterly dividend from 25 cents to 32 cents per share, payable on June 13 to shareholders on record by May 30. Its a nice perk for those holding the stock.

Technical Edge and Market Fit

The stock recently broke through the 210.46 buy point of a 14-week cup-with-handle pattern, trading just above it on Wednesday morning. The pattern dipped 44%, which is steeper than usual and could make the next climb tougher. Still, this deep drop reset the stocks base, setting the stage for a potential rebound.

Volume during the recent uptick has been lighter than during the earlier drop, leading to a D- Accumulation/Distribution Rating. But the Composite Rating stays high at 97, showing the stocks overall strength. With a 21-day average true range (ATR) of 3.02%, the stock moves at a steady pace, making it a good pick for investors as the S&P 500 and Nasdaq ride a strong trend.

The stock market today is full of action, with searches for terms like “stock market,” “Nvidia stock,” and “Dow Jones today” hitting 1 million to 10 million monthly views. With little change in trends and low competition, theres room for stocks like IBKR to shine. Bids for top page ads range from $1.67 to $75.21, with highs at $295.26, showing keen interest.

About Interactive Brokers

Interactive Brokers is a trusted online brokerage loved for its smart trading tools and worldwide reach. It serves millions, offering access to global markets and new features like crypto trading. Its focus on growth and customer service makes it a reliable choice.

See why Interactive Brokers is a solid pick for your investments. Check out their broker page now to start trading with a platform built for success!