Education
About Us
Working with TipRanks
Follow Us
CME Group (CME)
NASDAQ:CME
Top Page
CME Group
(NASDAQ:CME)
79Outperform
Positive Factors
Competitive Position
CME is seen as best placed in a period of prolonged uncertainty, with 80% of revenues derived from clearing and transaction fees, and a strong moat around futures and options complex.
Financial Performance
Raising 2025e Adj. EPS by +3.6% to $10.97.
Trading Volumes
Strong volumes momentum persist and accelerate into 2Q, with notable volume strength across interest rates, equities index, metals, and energy.
Negative Factors
Competitive Risks
FMX Futures, although launched with much fanfare, remains a minor concern as its volumes and open interest are a tiny fraction of CME's.
Market Conditions
The macro backdrop for CME remains constructive with heightened political uncertainty and market volatility.
CME Group (CME) vs. S&P 500 (SPY)
Market Cap
$101.06B
Dividend Yield3.74%
Average Volume (3M)2.93M
Price to Earnings (P/E)28.2
Beta (1Y)0.20
Revenue Growth11.72%
EPS Growth13.31%
CountryUS
Employees3,760
SectorFinancial
Sector Strength88
IndustryFinancial - Data & Stock Exchanges
Share Statistics
EPS (TTM)9.95
Shares Outstanding360,356,100
10 Day Avg. Volume2,257,192
30 Day Avg. Volume2,932,822
Financial Highlights & Ratios
PEG Ratio2.12
Price to Book (P/B)N/A
Price to Sales (P/S)0.00
Price to Cash Flow (P/CF)0.00
P/FCF Ratio0.00
Enterprise Value/Market Cap0.96
Enterprise Value/RevenueN/A
Enterprise Value/Gross Profit18.46
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$273.38Price Target Upside-2.52% Downside
Rating ConsensusModerate Buy
Number of Analyst Covering14
CME Group Business Overview & Revenue Model
Company DescriptionCME Group Inc., together with its subsidiaries, operates contract markets for the trading of futures and options on futures contracts worldwide. It offers futures and options products based on interest rates, equity indexes, foreign exchange, agricultural commodities, energy, and metals, as well as fixed income products. The company also provides clearing house services, including clearing, settling, and guaranteeing futures and options contracts, and cleared swaps products traded through its exchanges; and trade processing and risk mitigation services. In addition, the company offers a range of market data services, including real-time and historical data services. It serves professional traders, financial institutions, institutional and individual investors, corporations, manufacturers, producers, governments, and central banks. The company was formerly known as Chicago Mercantile Exchange Holdings Inc. and changed its name to CME Group Inc. in July 2007. CME Group Inc. was founded in 1898 and is headquartered in Chicago, Illinois.
How the Company Makes MoneyCME Group makes money primarily through transaction fees generated from trading activity on its platforms. This includes fees for trading futures and options contracts, as well as clearing and settlement services. Additionally, the company earns revenue from market data services by providing real-time and historical data products to traders and financial institutions. CME Group also benefits from licensing its market data and indices for use in financial products. The company has established significant partnerships and strategic alliances with other exchanges and financial institutions worldwide, further enhancing its revenue streams by expanding its product offerings and market reach.
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.85
Very Positive
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.78
Positive
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.80
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 6.13B | 5.58B | 5.02B | 4.69B | 4.88B | Gross Profit |
| 5.28B | 4.75B | 4.27B | 3.85B | 4.03B | EBIT |
| 3.93B | 3.44B | 3.02B | 2.65B | 2.64B | EBITDA |
| 4.61B | 3.79B | 3.37B | 2.99B | 3.14B | Net Income Common Stockholders |
| 3.53B | 3.23B | 2.69B | 2.64B | 2.11B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 3.01B | 3.02B | 2.82B | 2.95B | 1.73B | Total Assets |
| 137.45B | 129.71B | 174.18B | 196.78B | 124.66B | Total Debt |
| 3.43B | 3.88B | 3.44B | 3.45B | 3.44B | Net Debt |
| 535.60M | 971.90M | 718.30M | 610.20M | 1.81B | Total Liabilities |
| 110.96B | 102.97B | 147.30B | 169.38B | 98.31B | Stockholders Equity |
| 26.49B | 26.74B | 26.88B | 27.40B | 26.32B |
| Cash Flow | Free Cash Flow | |||
| 3.60B | 3.38B | 2.97B | 2.28B | 2.52B | Operating Cash Flow |
| 3.69B | 3.45B | 3.06B | 2.40B | 2.72B | Investing Cash Flow |
| -82.60M | 20.90M | -489.80M | 58.40M | -175.50M | Financing Cash Flow |
| 5.08B | -48.34B | -25.38B | 69.91B | -2.46B |
CME Group Technical Analysis
Positive
280.45
Price Trends
260.61
Positive
247.41
Positive
228.78
Positive
Market Momentum
4.67
Negative
71.08
Negative
95.25
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 280.45 is above the 20-day moving average (MA) of 263.91, above the 50-day MA of 260.61, and above the 200-day MA of 228.78, indicating a bullish trend. The MACD of 4.67 indicates Negative momentum. The RSI at 71.08 is Negative, neither overbought nor oversold. The STOCH value of 95.25 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CME.
CME Group Risk Analysis
CME Group disclosed 28 risk factors in its most recent earnings report. CME Group reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
CME Group Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $101.06B | 28.20 | 13.40% | 3.74% | 11.72% | 13.31% | |
79 Outperform | $99.50B | 36.28 | 10.27% | 1.05% | 15.32% | 14.02% | |
78 Outperform | $23.71B | 31.39 | 18.42% | 1.08% | 8.51% | 1.13% | |
77 Outperform | $44.88B | 35.45 | 11.43% | 1.23% | 25.89% | 16.37% | |
76 Outperform | $155.38B | 39.78 | 11.68% | 0.73% | 12.98% | 42.72% | |
75 Outperform | $78.73B | 38.85 | 57.90% | 0.75% | 15.95% | 26.38% | |
64 Neutral | $12.64B | 9.74 | 8.05% | 17044.60% | 12.66% | -4.62% |
* Financial Sector Average
Performance Comparison
CME
CME Group
280.45
81.65
41.07%
CBOE
Cboe Global Markets
226.39
45.73
25.31%
ICE
Intercontinental Exchange
173.45
43.71
33.69%
SPGI
S&P Global
506.62
84.03
19.88%
MCO
Moody's
464.75
79.97
20.78%
NDAQ
Nasdaq
78.18
17.42
28.67%
CME Group Earnings Call Summary
Earnings Call Date:Apr 23, 2025
(Q1-2025)
| % Change Since: 5.61%|
Next Earnings Date:Jul 23, 2025
Earnings Call Sentiment Positive
The earnings call presented a generally positive outlook, highlighting record-breaking financial performance, strong volume growth across all asset classes, and successful international expansion. While there were challenges related to increased margin requirements and specific market segments, these did not overshadow the overall achievements.Q1-2025 Updates
Positive Updates
Record-Breaking Revenue and Growth
CME Group reported its highest volume, revenue, operating income, and diluted earnings per share in its history, with quarterly revenue surpassing $1.6 billion and adjusted net income exceeding $1 billion.
Strong Volume Growth Across All Asset Classes
The first quarter average daily volume (ADV) of 29.8 million contracts was the highest in CME Group's history, marking a 13% increase compared to the same period last year. Volumes grew 19% for commodities and 12% for financial products.
International Business Expansion
CME Group's international business recorded an average of 8.8 million contracts per day, up 19% from the prior year, with strong growth across all asset classes and records in both EMEA and APAC regions.
Innovative Product Developments
New offerings such as BrokerTec Chicago and FX SPOT Plus were announced to enhance links between cash and futures markets and provide broader access to liquidity.
Robust Financial Performance
Adjusted operating income reached a record $1.2 billion, up 14% year over year, with a 71.1% adjusted operating margin. Adjusted diluted earnings per share were $2.80, up 12% from the first quarter last year.
Negative Updates
Impact of Increased Margin Requirements
In response to heightened volatility, margin requirements were increased, leading to a record single-day cash movement of $32 billion. The impact on liquidity and potential future trading volumes remains a concern.
Challenges in Certain Market Segments
Open interest in agricultural futures saw some declines in April, particularly in livestock and feeder cattle, despite overall strong performance in options.
Company Guidance
During the CME Group's first quarter 2025 earnings call, the company reported record-breaking financial metrics, highlighting a significant increase in revenue, operating income, and diluted earnings per share. Quarterly revenue surpassed $1.6 billion for the first time, while adjusted net income exceeded $1 billion. The average daily volume reached a record high of 29.8 million contracts, marking a 13% increase compared to the previous year, with growth across all six asset classes. The commodity sector volumes grew by 19%, and financial products by 12%. The international business also set a new record with an average of 8.8 million contracts per day, up 19% from the prior year. The company emphasized strong open interest growth, with a 7% increase from the previous year, indicating that market participants are actively managing risk. Additionally, CME Group recorded the highest quarterly clearing and transaction fees at $1.3 billion, up 11% year-over-year, and achieved an adjusted operating income of $1.2 billion, reflecting a 14% increase. The adjusted operating margin rose to 71.1%, and the adjusted net income margin exceeded 62%.CME Group Corporate Events
M&A TransactionsBusiness Operations and Strategy
CME Group Sells OSTTRA to KKR for $3.1 Billion
Positive
Apr 14, 2025
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.
Spark’s Take on CME Stock
According to Spark, TipRanks’ AI Analyst, CME is a Outperform.
CME Group’s overall stock score reflects its strong financial fundamentals, positive earnings outlook, and favorable valuation. The company is well-positioned within the capital markets industry, with strong revenue and profit growth, effective cost management, and strategic initiatives driving future growth. Technical indicators support a bullish view, although caution is advised due to potential overbought conditions.
To see Spark’s full report on CME stock, click here.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.