CME CME Group Inc. - Fundamental Analysis
NEUTRAL
CME Stock | Fundamental Analysis & Investment Insights
NASDAQ
•
Financial Services
•
Financial Data & Stock Exchanges
Current Price
$285.04
Analyst Target
$285.12
0.0% Downside
52W High
$290.79
52W Low
$224.62
AI Analysis
Powered by advanced machine learning algorithms
Confidence Score
75%
Analysis Accuracy
CME Group trades near fair value with strong profitability and a dominant market position in financial derivatives, supported by a 58.95% profit margin and 63.39% operating margin—both well above sector averages. However, near-term revenue contraction (-3.0% YoY) and stagnant earnings growth (0.0% YoY) raise concerns about cyclical headwinds, while the P/E of 27.6x is above the sector average of 21.8x, limiting upside. Price momentum remains solid with a 1Y return of +33.3%, but insider selling and a 103.7% payout ratio signal caution. Analysts are unanimous in a 'hold' rating, aligning with our neutral stance given mixed fundamentals and valuation.
Key Strengths
Exceptional profitability with 58.95% net margin and 63.39% operating margin, significantly above sector average of 24.08%
Dominant market position in futures and options with $102.78B market cap, the largest in its peer group
Low leverage with Debt/Equity of 0.13, well below sector average of 0.82 and peers like MCO (1.81)
Consistent earnings beat history: 23 of last 25 quarters met or exceeded estimates, with only two negative surprises in five years
Attractive dividend yield of 1.75%, above S&P 500 average, despite payout concerns
Key Risks
Revenue declining YoY (-3.0%) amid lower trading volumes, suggesting cyclical or structural demand weakness
Elevated valuation: P/E of 27.6x vs sector average of 21.8x and peer ICE at 27.7x, offering limited margin of safety
Payout ratio of 103.68% exceeds earnings, indicating dividend is not fully covered by net income and may not be sustainable long-term
Insider selling trend: $3.79M in net sales over last 6 months, including CTO selling 11,896 shares, signaling lack of confidence
Weak liquidity profile: Quick ratio of 0.02 indicates near-zero liquid assets relative to current liabilities, a red flag despite low debt
AI Fair Value Estimate
Based on comprehensive analysis
$285.0
-0.0% below current price
Performance Snowflake
Multi-dimensional AI analysis across 5 key categories
Stock Price & Analyst Targets
Real-time price movements and analyst price targets
Historical Performance Trends
Long-term financial metrics and growth patterns
Valuation Metrics
Key valuation ratios and pricing indicators
Profitability, Growth & Financial Health
Detailed profit margins, ROE, debt ratios, and liquidity metrics
Sector Comparison & Peer Analysis
Compare CME against industry averages and similar companies
Insider Trading & Analyst Ratings
Track insider transactions and Wall Street analyst recommendations