BofA Favors Alternative Asset Managers Over Online Brokers Like Interactive Brokers, Citing Superior Valuation and Macro Tailwinds for 2026

Interactive Brokers Group Inc. (NASDAQ:IBKR) is one of the best Reddit stocks to invest in right now. On December 10, Bank of America raised the firm’s price target on Interactive Brokers to $84 from $77 with a Buy rating on the shares. Looking ahead to 2026, BofA believes that investors should prioritize alternative asset managers over online brokers. This preference is driven by the former’s superior valuation and market positioning, which is expected to benefit from a stronger macro backdrop.

Earlier in Q3 2025, Interactive Brokers Group reported a 21% year-over-year increase in net revenues, which totaled $1.66 billion, contributing to a high pretax margin of 79% for the quarter. Total assets reached $200 billion, which marked a 35% increase from the prior-year quarter. The company also made an EPS of $0.57 in Q3, which beat Street expectations by $0.03.

BofA Favors Alternative Asset Managers Over Online Brokers Like Interactive Brokers, Citing Superior Valuation and Macro Tailwinds for 2026

Commission revenue also surged by 23% from last year, reaching $537 million, reflecting the jump in trading activity. Interactive Brokers Group surpassed the milestone of 4 million customers, with total customer accounts growing by 32% year-over-year to 4.13 million. However, the company faces ongoing challenges, including a potential $417 million reduction in annual net interest income if all benchmark rates were to fall by a full 1%.

Interactive Brokers Group Inc. (NASDAQ:IBKR) operates as an automated electronic broker in the US and internationally.

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Disclosure: None. This article is originally published at Insider Monkey.