CME GROUP INC (CME) Stock Fundamental Analysis
NASDAQ:CME - Nasdaq - US12572Q1058 - Common Stock - Currency: USD
We assign a fundamental rating of 5 out of 10 to CME. CME was compared to 232 industry peers in the Capital Markets industry. While CME has a great profitability rating, there are some minor concerns on its financial health. While showing a medium growth rate, CME is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
In the past year CME was profitable.
In the past year CME had a positive cash flow from operations.
In the past 5 years CME has always been profitable.
Each year in the past 5 years CME had a positive operating cash flow.
1.2 Ratios
The Return On Assets of CME (2.27%) is comparable to the rest of the industry.
CME has a better Return On Equity (13.25%) than 71.12% of its industry peers.
Looking at the Return On Invested Capital, with a value of 17.02%, CME belongs to the top of the industry, outperforming 92.24% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for CME is significantly above the industry average of 7.87%.
The last Return On Invested Capital (17.02%) for CME is above the 3 year average (15.81%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.27% | ||
| ROE | 13.25% | ||
| ROIC | 17.02% |
ROA(3y)2.17%
ROA(5y)1.91%
ROE(3y)11.65%
ROE(5y)10.5%
ROIC(3y)15.81%
ROIC(5y)11.95%
1.3 Margins
CME has a better Profit Margin (35.16%) than 78.02% of its industry peers.
In the last couple of years the Profit Margin of CME has declined.
Looking at the Operating Margin, with a value of 78.35%, CME belongs to the top of the industry, outperforming 99.14% of the companies in the same industry.
CME's Operating Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 78.35% | ||
| PM (TTM) | 35.16% | ||
| GM | N/A |
OM growth 3Y9.92%
OM growth 5Y6.02%
PM growth 3Y-13.33%
PM growth 5Y-2.37%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
CME has about the same amout of shares outstanding than it did 1 year ago.
Compared to 5 years ago, CME has more shares outstanding
The debt/assets ratio for CME has been reduced compared to a year ago.
2.2 Solvency
Based on the Altman-Z score of 0.73, we must say that CME is in the distress zone and has some risk of bankruptcy.
CME's Altman-Z score of 0.73 is in line compared to the rest of the industry. CME outperforms 43.10% of its industry peers.
CME has a debt to FCF ratio of 0.91. This is a very positive value and a sign of high solvency as it would only need 0.91 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 0.91, CME belongs to the top of the industry, outperforming 88.36% of the companies in the same industry.
CME has a Debt/Equity ratio of 0.13. This is a healthy value indicating a solid balance between debt and equity.
CME has a better Debt to Equity ratio (0.13) than 78.88% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.13 | ||
| Debt/FCF | 0.91 | ||
| Altman-Z | 0.73 |
ROIC/WACCN/A
WACCN/A
2.3 Liquidity
A Current Ratio of 1.02 indicates that CME should not have too much problems paying its short term obligations.
With a Current ratio value of 1.02, CME perfoms like the industry average, outperforming 42.24% of the companies in the same industry.
CME has a Quick Ratio of 1.02. This is a normal value and indicates that CME is financially healthy and should not expect problems in meeting its short term obligations.
CME has a Quick ratio (1.02) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.02 | ||
| Quick Ratio | 1.02 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 12.10% over the past year.
CME shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 8.57% yearly.
Looking at the last year, CME shows a decrease in Revenue. The Revenue has decreased by -4.04% in the last year.
The Revenue has been growing by 13.14% on average over the past years. This is quite good.
EPS 1Y (TTM)12.1%
EPS 3Y15.32%
EPS 5Y8.57%
EPS Q2Q%12%
Revenue 1Y (TTM)-4.04%
Revenue growth 3Y26.89%
Revenue growth 5Y13.14%
Sales Q2Q%10.38%
3.2 Future
The Earnings Per Share is expected to grow by 7.08% on average over the next years.
The Revenue is expected to grow by 4.32% on average over the next years.
EPS Next Y10.26%
EPS Next 2Y7.12%
EPS Next 3Y7.21%
EPS Next 5Y7.08%
Revenue Next Year8.34%
Revenue Next 2Y6.17%
Revenue Next 3Y5.97%
Revenue Next 5Y4.32%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 25.52 indicates a quite expensive valuation of CME.
Based on the Price/Earnings ratio, CME is valued a bit more expensive than the industry average as 66.81% of the companies are valued more cheaply.
The average S&P500 Price/Earnings ratio is at 26.32. CME is around the same levels.
CME is valuated rather expensively with a Price/Forward Earnings ratio of 22.89.
CME's Price/Forward Earnings ratio is a bit more expensive when compared to the industry. CME is more expensive than 62.50% of the companies in the same industry.
CME's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 22.13.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.52 | ||
| Fwd PE | 22.89 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, CME is valued cheaply inside the industry as 84.91% of the companies are valued more expensively.
The rest of the industry has a similar Price/Free Cash Flow ratio as CME.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 25.38 | ||
| EV/EBITDA | 11.9 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
CME has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)2.49
PEG (5Y)2.98
EPS Next 2Y7.12%
EPS Next 3Y7.21%
5. Dividend
5.1 Amount
CME has a Yearly Dividend Yield of 3.91%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 7.91, CME has a dividend in line with its industry peers.
CME's Dividend Yield is rather good when compared to the S&P500 average which is at 2.40.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.91% |
5.2 History
On average, the dividend of CME grows each year by 16.00%, which is quite nice.
CME has paid a dividend for at least 10 years, which is a reliable track record.
CME has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)16%
Div Incr Years11
Div Non Decr Years11
5.3 Sustainability
106.75% of the earnings are spent on dividend by CME. This is not a sustainable payout ratio.
The dividend of CME is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP106.75%
EPS Next 2Y7.12%
EPS Next 3Y7.21%
269.5
-1.46 (-0.54%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryCapital Markets
Earnings (Last)
Earnings (Next)
Inst Owners91.38%
Inst Owner Change2.83%
Ins Owners0.24%
Ins Owner Change-2.85%
Market Cap97.12B
Analysts70
Price Target282.4 (4.79%)
Short Float %1.32%
Short Ratio1.8
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.91% |
Yearly Dividend9.97
Dividend Growth(5Y)16%
DP106.75%
Div Incr Years11
Div Non Decr Years11
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)0.38%
Min EPS beat(2)-1.28%
Max EPS beat(2)2.05%
EPS beat(4)2
Avg EPS beat(4)0.19%
Min EPS beat(4)-1.28%
Max EPS beat(4)2.05%
EPS beat(8)6
Avg EPS beat(8)1.04%
EPS beat(12)10
Avg EPS beat(12)1.02%
EPS beat(16)14
Avg EPS beat(16)1.22%
Revenue beat(2)0
Avg Revenue beat(2)-1.14%
Min Revenue beat(2)-1.72%
Max Revenue beat(2)-0.57%
Revenue beat(4)0
Avg Revenue beat(4)-1%
Min Revenue beat(4)-1.72%
Max Revenue beat(4)-0.57%
Revenue beat(8)1
Avg Revenue beat(8)-0.7%
Revenue beat(12)5
Avg Revenue beat(12)13.84%
Revenue beat(16)9
Avg Revenue beat(16)11.79%
PT rev (1m)0.31%
PT rev (3m)7.13%
EPS NQ rev (1m)0.32%
EPS NQ rev (3m)11.5%
EPS NY rev (1m)0%
EPS NY rev (3m)6.41%
Revenue NQ rev (1m)0.53%
Revenue NQ rev (3m)7.85%
Revenue NY rev (1m)0%
Revenue NY rev (3m)4.53%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.52 | ||
| Fwd PE | 22.89 | ||
| P/S | 9.54 | ||
| P/FCF | 25.38 | ||
| P/OCF | 24.81 | ||
| P/B | 3.59 | ||
| P/tB | N/A | ||
| EV/EBITDA | 11.9 |
EPS(TTM)10.56
EY3.92%
EPS(NY)11.77
Fwd EY4.37%
FCF(TTM)10.62
FCFY3.94%
OCF(TTM)10.86
OCFY4.03%
SpS28.26
BVpS75.01
TBVpS-9.48
PEG (NY)2.49
PEG (5Y)2.98
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.27% | ||
| ROE | 13.25% | ||
| ROCE | 21.92% | ||
| ROIC | 17.02% | ||
| ROICexc | 17.76% | ||
| ROICexgc | 139.44% | ||
| OM | 78.35% | ||
| PM (TTM) | 35.16% | ||
| GM | N/A | ||
| FCFM | 37.57% |
ROA(3y)2.17%
ROA(5y)1.91%
ROE(3y)11.65%
ROE(5y)10.5%
ROIC(3y)15.81%
ROIC(5y)11.95%
ROICexc(3y)17.24%
ROICexc(5y)12.98%
ROICexgc(3y)263.94%
ROICexgc(5y)202.43%
ROCE(3y)20.37%
ROCE(5y)15.39%
ROICexcg growth 3Y53.64%
ROICexcg growth 5Y25.03%
ROICexc growth 3Y41.34%
ROICexc growth 5Y22.06%
OM growth 3Y9.92%
OM growth 5Y6.02%
PM growth 3Y-13.33%
PM growth 5Y-2.37%
GM growth 3YN/A
GM growth 5YN/A
F-Score5
Asset Turnover0.06
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.13 | ||
| Debt/FCF | 0.91 | ||
| Debt/EBITDA | 0.42 | ||
| Cap/Depr | 26.47% | ||
| Cap/Sales | 0.87% | ||
| Interest Coverage | 61.44 | ||
| Cash Conversion | 47.08% | ||
| Profit Quality | 106.83% | ||
| Current Ratio | 1.02 | ||
| Quick Ratio | 1.02 | ||
| Altman-Z | 0.73 |
F-Score5
WACCN/A
ROIC/WACCN/A
Cap/Depr(3y)24.77%
Cap/Depr(5y)29.97%
Cap/Sales(3y)0.96%
Cap/Sales(5y)1.86%
Profit Quality(3y)106.99%
Profit Quality(5y)105.5%
High Growth Momentum
Growth
EPS 1Y (TTM)12.1%
EPS 3Y15.32%
EPS 5Y8.57%
EPS Q2Q%12%
EPS Next Y10.26%
EPS Next 2Y7.12%
EPS Next 3Y7.21%
EPS Next 5Y7.08%
Revenue 1Y (TTM)-4.04%
Revenue growth 3Y26.89%
Revenue growth 5Y13.14%
Sales Q2Q%10.38%
Revenue Next Year8.34%
Revenue Next 2Y6.17%
Revenue Next 3Y5.97%
Revenue Next 5Y4.32%
EBIT growth 1Y-5.79%
EBIT growth 3Y39.48%
EBIT growth 5Y19.95%
EBIT Next Year12.83%
EBIT Next 3Y8.86%
EBIT Next 5Y7.1%
FCF growth 1Y24.31%
FCF growth 3Y16.49%
FCF growth 5Y8.18%
OCF growth 1Y23.9%
OCF growth 3Y15.38%
OCF growth 5Y6.67%