What happened

Shares of Intercontinental Exchange (ICE -0.49%) certainly began the month on a high note, riding a bullish wave that got rolling in November. But, when all was said and done, the stock ended February down 10.5%, according to data provided by S&P Global Market Intelligence.

Most of that loss was suffered in the span of just three days early in the month. The company surprised some investors when it confirmed on Feb. 4 that it was entertaining the idea of acquiring online auction platform eBay (EBAY -1.26%), sending shares sharply lower. It surprised and disappointed other investors when it said two days later it wasn't moving ahead with the prospect after all, pushing shares lower once again.

A hand drawing a falling chart on a chalkboard

Image source: Getty Images.

So what

Intercontinental Exchange -- the parent company to several capital markets exchanges, including the New York Stock Exchange -- has a history of success using acquisitions as growth drivers. As the number of compelling buyout targets shrinks, though, Intercontinental Exchange increasingly finds growth to be a challenge. At the same time, regulatory limits on price increases and the number of data-based products the company can sell have made growth even tougher to muster.

The addition of eBay, while seemingly unusual, would have sidestepped the regulatory-related pricing challenges, since eBay is a consumer-oriented company and not subject to the limiting scrutiny of the Securities and Exchange Commission. The two organizations could also have been able to share technologies that connect buyers to sellers in a variety of ways. The pairing even had the potential to serve as a fundraising platform of sorts for smaller companies that weren't quite ready for a full-blown exchange listing. But it wasn't meant to be. CEO Jeff Sprecher explained during the quarterly conference call on Feb. 6 that Intercontinental Exchange wouldn't pursue a deal with eBay.

The short-lived saga is noteworthy simply because both the possibility of the deal, and the negation of that possibility, pushed shares downward.

Now what

Intercontinental Exchange shares snapped back later in the month, only to roll over again during the latter half of February as coronavirus fears swelled. The share price is on the fence now, positioned to move higher or lower if traders can figure out how they feel.

Regardless, the underpinnings of the eBay debacle still stand. If Intercontinental Exchange wants to grow and can't do so through increased trading revenue alone, it needs to find good acquisition targets and get deals done. Should the coronavirus contagion turn into a global epidemic, such plans would likely be postponed -- not that the company had any other major deals on the horizon.