Meet the Under-the-Radar Growth Stock Crushing the S&P 500, the Nasdaq-100, and the Dow Jones in 2026
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Meet the Under-the-Radar Growth Stock Crushing the S&P 500, the Nasdaq-100, and the Dow Jones in 2026
010 mins
The stock market is off to a rollercoaster start to 2026. The benchmark S&P 500 (SNPINDEX: ^GSPC) was down 9% from its peak at its March low point, only to recover all of its losses and set a new high in April. The persistent geopolitical tensions between the U.S. and Iran have sparked wild swings in oil prices, and investors are trying to determine how this will affect corporate earnings and the economy.
Interactive Brokers(NASDAQ: IBKR) operates one of the world’s largest digital investing platforms, where its clients buy and sell stocks, futures, options, cryptocurrencies, and more. Extreme volatility in the stock market typically fuels strong growth in the company’s commission revenue, which is why investors are piling into its stock in 2026, propelling it to a 21% gain so far (as of April 22).
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As a result, Interactive is crushing the S&P 500, the Nasdaq-100, and the Dow Jones Industrial Average(DJINDICES: ^DJI), which are nursing modest gains of between 3% and 6% in 2026 after their recent recoveries.
Here’s why I think the brokerage giant will continue to outperform the market.
Image source: Getty Images.
Stock market volatility tends to grab headlines and pique the interest of new potential investors. As a result, Interactive had a record 4.75 million client accounts at the end of the first quarter, which was up by a blistering 31% compared to the year-ago period.
Client equity was also at a record high of $789.4 billion at the end of the quarter, which measures the total value of the cash and financial assets in every Interactive account. That was up 38% year over year, which actually marked an acceleration from 37% growth in the fourth quarter of 2025, just three months earlier. Since Interactive earns commissions based on the value of every trade, a higher equity figure can translate into more revenue over time.
Interactive processed an average of 4.37 million transactions every day during the opening three months of 2026, a 24% increase. That included a 25% rise in stock trading volume, a 20% gain in futures volume, and a 16% increase in options volume, reflecting the heightened volatility in the markets.
The wild market swings didn’t seem to damp risk appetite, though, because Interactive’s margin loan book swelled by 35% to $86 billion during the quarter, so investors were still borrowing truckloads of money to buy stocks and other financial assets.
Interactive generated $1.67 billion in total revenue during the first quarter, representing 17% growth from the year-ago period. There were three primary components to that number:
$904 million in net interest income, representing the interest Interactive earned on margin loans, client cash balances, and its own corporate cash balance. This grew by 17%.
$613 million in commission revenue, which jumped by 19% thanks to heightened trading volumes.
$152 million in other fees and charges, which grew by a modest 6%.
It was a good sign that commission revenue grew faster than all other sources, because this is the money Interactive earned from operating its core business. The company has less control over its net interest revenue, because it’s heavily influenced by external factors like the direction of interest rates, and investors’ appetite for risky margin loans.
Interactive’s strong total revenue, combined with only a very modest increase in operating expenses, resulted in a 23% increase in the company’s earnings, which came in at $0.59 per share.
Not only is Interactive stock beating the market in 2026 with its 21% gain, but it has also nearly doubled over the last 12 months. It isn’t exactly cheap after that blistering run; based on the company’s trailing-12-month earnings of $2.32 per share, it’s trading at a price-to-earnings (P/E) ratio of 33.6, a premium to both the S&P 500 and the Nasdaq-100.
However, I’m not surprised investors are paying up to own a slice of Interactive. The financial markets are likely to remain volatile for the foreseeable future, given the ongoing war in Iran and the midterm congressional elections in November, which could shift the balance of power in Washington, D.C. Therefore, the market is probably pricing in continued strength in Interactive’s commission revenue.
However, the company has also overcome one of its biggest risks of late: falling interest rates. The Federal Reserve has cut rates three times since September 2024, which would normally dent Interactive’s net interest revenue, but the enormous growth in the company’s margin loan book is offsetting this headwind. To put it another way, what Interactive is losing by charging lower interest rates, it’s making up for in sheer loan volume.
As a result, I think the strength across Interactive’s business will fuel continued upside in its stock from here.
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Anthony Di Pizio has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Interactive Brokers Group. The Motley Fool recommends the following options: long January 2027 $43.75 calls on Interactive Brokers Group and short January 2027 $46.25 calls on Interactive Brokers Group. The Motley Fool has a disclosure policy.
