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Interactive Brokers Group Inc (IBKR) says its profit and revenue surpassed Street estimates as higher trading volumes pushed commission revenue up 26% in its second financial quarter.  

IBKR stock is being rewarded in extended hours also because the largest U.S. trading platform ended its Q2 with 2.92 million customers in total – up a whopping 28% on a year-over-year basis.

Higher benchmark interest rates also delivered a 14% annualised growth to the company’s net interest income in the recently concluded quarter. Interactive Brokers stock is now up more than 50% for the year.

Interactive Brokers Q2 earnings snapshot
 

• Earned $809 million versus the year-ago $601 million
• Per-share earnings also improved from $1.20 to $1.65
• Adjusted EPS printed at $1.76 as per the earnings report
• Revenue popped 22% year-over-year to $1.29 billion
• Consensus was $1.71 a share on $1.26 billion in revenue

Interactive Brokers also announced 25 cents a share of the quarterly cash dividend on Tuesday.

Why else is IBKR gaining in extended hours?
 

Interactive Brokers stock is gaining in after-hours also because the company improved its pretax profit margin by an impressive 600 basis points to 73% in the second quarter.

The financial services company ended the three-month period with $15.2 billion in total equity.

Other notable figures in its Q2 earnings release include an 8.0% increase in customer credits to $107.1 billion while customer margin loans jumped 32% year-on-year to $55.1 billion.

IBKR share price is now up an exciting 2.5 times versus before the pandemic in 2019.

Is Interactive Brokers stock worth owning in July?
 

Interactive Brokers lost $48 million last month due to an NYSE glitch that caused several stocks including Berkshire Hathaway of the legendary investor Warren Buffett appear to tank sharply.

The Nasdaq-listed firm is now exploring options, including legal action, to recover the funds.

Ahead of IBRK’s quarterly report, analysts at Citi reiterated their “buy” rating on the stock which, they said, could climb to $145 which signals the potential for another 12% gain from here.

The investment firm agreed that the company’s net interest income may decline moving forward now that the U.S. Federal Reserve is expected to start cutting rates from September. But a continued increase in a number of customer accounts, a robust trading environment, and solid cash balances, it added, will more than offset that headwind.

Analysts at other firms including Piper Sandler and Barclays continue to recommend owning Interactive Brokers stock as well.

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