CME Group (CME) AI Stock Analysis

• Market Cap: $99.71B
• Dividend Yield: 1.81%
• Average Volume (3M): 2.50M
• Price to Earnings (P/E): 27.8
• Beta (1Y): 0.11
• Revenue Growth: 11.72%
• EPS Growth: 13.31%
• Country: US
• Employees: 3,760
• Sector: Financial
• Sector Strength: 82
• Industry: Financial - Data & Stock Exchanges
• EPS (TTM): 2.80
• Shares Outstanding: 360,356,100
• 10 Day Avg. Volume: 3,087,678
• 30 Day Avg. Volume: 2,500,522
• PEG Ratio: 9.55
• Price to Book (P/B): 3.65
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 25.81
• Enterprise Value/Market Cap: 1.01
• Enterprise Value/Revenue: 4.15
• Enterprise Value/Gross Profit: 18.54
• Enterprise Value/Ebitda: 5.60
• 1Y Price Target: $283.08
• Price Target Upside: 2.31% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 14

• Rating: 79 Outperform
• Price Target: ―

CME Group's strong financial performance and positive earnings outlook are key strengths, supported by strategic corporate actions like the OSTTRA sale. While technical indicators suggest a bullish trend, potential overbought conditions should be monitored. The company's valuation is reasonable, reflecting robust growth prospects.

Positive Factors

Competitive Advantage

Concerns about the competitive landscape and the impact of Federal Reserve rate cuts are fading, providing upside opportunity for CME's valuation multiple.

Market Position

CME is well positioned to benefit from any pickup in volatility given its asset diversity and depth of liquidity on the platform.

Volume Growth

CME saw record quarterly ADV of 30.2M contracts led by growth across all assets classes, with record volumes in rates, ags, and metals.

Negative Factors

Interest Rates

Supportive tailwinds bolster the rates volumes outlook due to uncertainty around interest rates and higher debt issuances.

Volume Trends

Volumes trends have moderated from the elevated levels as expected, indicating potential slowdown.

CME Group Business Overview & Revenue Model

Company Description

CME Group Inc. is a leading global derivatives marketplace headquartered in Chicago, Illinois. The company operates exchanges that offer a broad range of products across major asset classes, including futures and options contracts based on interest rates, equity indexes, foreign exchange, energy, agricultural commodities, and metals. CME Group's core services include providing a trusted and regulated platform for price discovery, risk management, and access to capital through its electronic trading platforms and clearing services.

How the Company Makes Money

CME Group generates revenue primarily through transaction fees collected from trading and clearing activities on its exchanges. These fees are charged per contract traded and vary depending on the type of contract and the participant involved. In addition to transaction fees, CME Group earns revenue from market data and information services, which provide market participants with real-time and historical data. The company also derives income from its clearing and settlement services, which manage risk and ensure the integrity of trades. Significant partnerships, such as those with global financial institutions and other exchanges, enhance CME Group's market reach and liquidity, further contributing to its revenue streams.

CME Group Financial Statement Overview

Summary

CME Group demonstrates strong financial health with consistent revenue and profit growth, robust profitability margins, and effective cash flow management. Despite a solid balance sheet, the relatively low Equity Ratio indicates some reliance on liabilities.

Income Statement

CME Group demonstrates robust financial performance with consistent revenue growth and strong profitability margins. The TTM Gross Profit Margin is high at approximately 86.5%, and the Net Profit Margin is impressive at 57.0%. Revenue growth from the previous year is notable at 12.2%, indicating a positive trajectory. Additionally, both EBIT and EBITDA margins are strong at 64.9% and 76.3% respectively, reflecting efficient operational management.

Balance Sheet

The company's balance sheet is solid with a moderate Debt-to-Equity Ratio of 0.13, showcasing low leverage. The Equity Ratio stands at 17.1%, indicating a reasonable proportion of equity in the asset base. Return on Equity (ROE) is strong at 13.2%, demonstrating effective use of equity to generate profits. The company's financial position is stable, but the relatively low Equity Ratio highlights some reliance on liabilities.

Cash Flow

CME Group's cash flow position is healthy, with a Free Cash Flow Growth Rate of 6.8% over the previous year. The Operating Cash Flow to Net Income Ratio is 1.09, indicating good cash generation relative to net income. Moreover, the Free Cash Flow to Net Income Ratio is 1.07, reflecting effective cash management. The company maintains strong liquidity and demonstrates efficient cash flow management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	6.28B	6.13B	5.58B	5.02B	4.69B	4.88B
Gross Profit	5.43B	5.28B	4.75B	4.27B	3.85B	4.03B
EBITDA	4.98B	4.61B	3.79B	3.37B	2.99B	3.14B
Net Income	3.59B	3.53B	3.23B	2.69B	2.64B	2.11B
Balance Sheet
Total Assets	157.83B	137.45B	129.71B	174.18B	196.78B	124.66B
Cash, Cash Equivalents and Short-Term Investments	1.52B	3.01B	3.02B	2.82B	2.95B	1.73B
Total Debt	3.42B	3.43B	3.88B	3.44B	3.45B	3.44B
Total Liabilities	130.80B	110.96B	102.97B	147.30B	169.38B	98.31B
Stockholders Equity	27.03B	26.49B	26.74B	26.88B	27.40B	26.32B
Cash Flow
Free Cash Flow	3.83B	3.60B	3.38B	2.97B	2.28B	2.52B
Operating Cash Flow	3.91B	3.69B	3.45B	3.06B	2.40B	2.72B
Investing Cash Flow	-75.80M	-82.60M	20.90M	-489.80M	58.40M	-175.50M
Financing Cash Flow	22.35B	5.08B	-48.34B	-25.38B	69.91B	-2.46B

CME Group Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 276.70
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CME, the sentiment is Positive. The current price of 276.7 is above the 20-day moving average (MA) of 272.14, above the 50-day MA of 274.85, and above the 200-day MA of 244.01, indicating a bullish trend. The MACD of 0.33 indicates Negative momentum. The RSI at 55.95 is Neutral, neither overbought nor oversold. The STOCH value of 86.73 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CME.

CME Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NDAQ	83 Outperform	$51.71B	40.84	11.43%	1.20%	25.89%	16.37%
SPGI	80 Outperform	$162.43B	41.58	11.68%	0.72%	12.98%	42.72%
CBOE	80 Outperform	$24.23B	30.33	18.93%	1.09%	15.76%	1.97%
CME	79 Outperform	$99.71B	27.82	13.40%	1.81%	11.72%	13.31%
ICE	79 Outperform	$105.04B	37.92	10.27%	1.05%	13.25%	10.82%
MCO	75 Outperform	$90.86B	43.63	57.90%	0.74%	15.95%	26.38%
Sector *	58 Neutral	$12.97B	5.12	-2.61%	5.35%	5.83%	-54.44%

CME Group Corporate Events

CME Group Concludes 2025 Annual Shareholder Meeting

CME Group Inc. held its 2025 Annual Meeting of Shareholders on May 8, 2025, where key proposals were voted on by shareholders. The election of fourteen Equity Directors was completed, with all nominees elected to serve until 2026. Additionally, the appointment of Ernst & Young LLP as the independent public accounting firm for 2025 was ratified, and the compensation of the company’s named executive officers was approved. However, no quorum was achieved for the election of Class B Directors, resulting in several directors continuing as ‘holdovers’ until the next election in 2026.

CME Group Sells OSTTRA to KKR for $3.1 Billion

On April 14, 2025, CME Group and S&P Global announced the sale of their joint venture, OSTTRA, to investment funds managed by KKR for $3.1 billion. OSTTRA, established in 2021, is a key provider of post-trade solutions for the global OTC market, and the transaction is expected to close in the second half of 2025. KKR plans to support OSTTRA’s growth by investing in technology and innovation, while maintaining the current management team. This sale reflects S&P Global’s strategy of portfolio optimization and is expected to enhance OSTTRA’s market position and customer value.