Intercontinental Exchange (ICE) Surged in Q1. Here’s Why

Meridian Funds, managed by ArrowMark Partners, released its “Meridian Hedged Equity Fund” first quarter 2025 investor letter. A copy of the letter can be downloaded here. The uncertainty surrounding prospective tariff policies weighed on investor sentiment and risk assets in the first quarter of 2025. The fund returned -0.15% (net) in the quarter compared to the S&P 500 Index’s -4.27% return and its secondary benchmark, the CBOE S&P 500 Buy/Write Index’s -3.09% return. In addition, you can check the fund’s top 5 holdings to determine its best picks for 2025.

In its first-quarter 2025 investor letter, Meridian Hedged Equity Fund highlighted stocks such as Intercontinental Exchange, Inc. (NYSE:ICE). Intercontinental Exchange, Inc. (NYSE:ICE) is a financial services company that offers market infrastructure, data services, and technology solutions for financial institutions, corporations, and government entities. The one-month return of Intercontinental Exchange, Inc. (NYSE:ICE) was 2.09%, and its shares gained 29.02% of their value over the last 52 weeks. On June 10, 2025, Intercontinental Exchange, Inc. (NYSE:ICE) stock closed at $175.53 per share, with a market capitalization of $100.689 billion.

Meridian Hedged Equity Fund stated the following regarding Intercontinental Exchange, Inc. (NYSE:ICE) in its Q1 2025 investor letter:

“Intercontinental Exchange, Inc. (NYSE:ICE) operates a global network of exchanges, clearing houses, and data services spanning major asset classes, including energy, equities, fixed income, and U.S. residential mortgages. We like the company for its diversified business model and leading position in energy markets, which continues to benefit from secular trends such as the global energy transition.

We also see meaningful growth potential in the company’s efforts to digitize mortgage workflows. A growing base of recurring revenue and free cash flow further support the fundamental stability of the business. During the quarter, heightened market volatility and geopolitical uncertainty drove expectations for strong growth in its exchanges segment, particularly within energy and interest-rate futures. While the mortgage technology segment continued to face cyclical headwinds, we believe signs of stabilization have emerged. We continue to hold our position.”

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Intercontinental Exchange, Inc. (NYSE:ICE) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 94 hedge fund portfolios held Intercontinental Exchange, Inc. (NYSE:ICE) at the end of the first quarter, which was 91 in the previous quarter. In Q1 2025, Intercontinental Exchange, Inc. (NYSE:ICE) reported an 8% increase in net revenue. While we acknowledge the potential of Intercontinental Exchange, Inc. (NYSE:ICE) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the undervalued AI stock set for massive gains.

In another article, we covered Intercontinental Exchange, Inc. (NYSE:ICE) and shared Sands Capital Select Growth Strategy’s views on the company. In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors.

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