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

Core Viewpoint - Interactive Brokers Group Inc. is highlighted as a strong investment option, particularly among Reddit stocks, with a recent price target increase from Bank of America indicating positive market sentiment [1]. Financial Performance - In Q3 2025, Interactive Brokers reported a 21% year-over-year increase in net revenues, totaling $1.66 billion, and achieved a high pretax margin of 79% for the quarter [2]. - The company’s total assets reached $200 billion, marking a 35% increase from the previous year [2]. - Earnings per share (EPS) for Q3 was $0.57, exceeding market expectations by $0.03 [2]. Customer Growth and Revenue Streams - Commission revenue surged by 23% year-over-year, reaching $537 million, driven by increased trading activity [3]. - The company surpassed 4 million customers, with total customer accounts growing by 32% year-over-year to 4.13 million [3]. Market Positioning and Future Outlook - Bank of America favors alternative asset managers over online brokers like Interactive Brokers for 2026, citing superior valuation and favorable macroeconomic conditions [1][3]. - The company may face challenges, including a potential $417 million reduction in annual net interest income if benchmark rates decline by 1% [3].

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