Buffett Brain · Research note
Score updated 21 Oct 2026 · analysis from 18 May 2026
IBKR· Financial Services
Interactive Brokers Group
Interactive Brokers compounds revenue at 36.6% with 86.7% operating margins, but management dilutes shareholders 4.3% per year and the bank-like balance sheet defies Buffett-style scrutiny.
Buffett fit
Partial fit
Owner
65
Durability
85
Management
75
Price
64
Score updated 21 Oct 2026 · analysis from 18 May 2026
Buffett's checklist
Each number against Buffett's bar, and where it ranks among Financial Services stocks in our database.
How much profit the business makes on each dollar invested in it. Higher is better.
What is left of each sale after the cost of making the product. A high number often means pricing power.
The cash the business earns for its owners, compared with the price of the whole company.
How fast sales grew each year over the last five years.
How many years of today's profit you pay for at today's price. Lower means cheaper.
How much the company owes compared with what it owns outright. Lower is safer.
The four pillars
How the business measures up on each of Buffett's four tests.
Ten years of owning all of Interactive Brokers means owning a tollbooth on global electronic trading run by Thomas Peterffy, who still owns most of it himself, the founder-aligned dynamic Buffett prizes.
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Electronic trading volumes have grown for two decades and the next two decades likely look similar, more asset classes, more geographies, more retail and institutional participation.
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This is where the verdict tilts away from yes. Share count grew 4.3% per year over five years, dilution funding employee comp at a firm already swimming in cash.
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At 37.3x earnings the headline multiple looks expensive, yet the 10.5% owner-earnings yield and 14x EV/ tell a more nuanced story, GAAP EPS understates true cash generation.
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For and against
The strongest points on each side, with the numbers behind them.
In its favor
6- 191.74% and 86.76% reflect software-like economics
- 2Revenue CAGR of 36.59% over five years among the best in financial services
- 3EPS CAGR of 28.52%, Peterffy-led execution has been outstanding
- 4Owner-earnings yield of 10.52% is genuinely attractive at this multiple
Concerns
5- 1 of 37.34 leaves limited cushion if growth decelerates
- 2Share count grew 4.28% annually, shareholder dilution is steady
- 3Interest coverage of 2.14x is thin for a financial firm
- 4 of 3.84% TTM is modest because of the bank-like asset base
Price history
$85.33+358.3%· 5-year return
Weekly closing prices. Touch or hover the line for a date.
The business
How the business works
Interactive Brokers runs the lowest-cost automated electronic brokerage on the planet, clearing trades in stocks, options, futures, forex, bonds, ETFs, and crypto for self-directed traders and institutions in 200-plus countries. Its 91.7% and 86.8% reveal a software-and-clearing utility that captures spread, commissions, margin lending interest, and FX fees on every transaction. Net interest income on customer credit balances has become a massive earnings engine in a higher-rate world.
What other investors would say
The same company, judged by three other documented playbooks.
Keep researching
Similar companies in Financial Services
Questions about Interactive Brokers Group
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