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CME Group (CME) Q1 Earnings Beat, Revenues Miss Estimates

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CME Group Inc. (CME - Free Report) reported first-quarter 2019 adjusted earnings per share of $1.62, which beat the Zacks Consensus Estimate by 1.3%. However, the bottom line declined 12.9% year over year.

The quarter witnessed low levels of volatility in several product areas. However, product innovation and a growing proportion of volume from customers outside the United States helped.

Net income came in at $1.39 per share, which plunged 21% year over year.

CME Group Inc. Price, Consensus and EPS Surprise

Performance in Detail

CME Group’s revenues of $1.2 billion increased 6.4% year over year. The top line however missed the Zacks Consensus Estimate by 1%. The year-over-year increase in revenues can be attributed to higher market data and information services (up 37% year over year), and other (up 139% from the prior-year period).

Total expenses increased 49% year over year to $548.6 million during the reported quarter, attributable to higher compensation and benefits, technology expenses, professional fees and outside services, depreciation and amortization as well as other.

Operating income declined 14.8% from the prior-year quarter to $631 million.

Average daily volume was 18.6 million contracts in the quarter. This marked the third-highest quarter ever in terms of average daily volume. However, it slipped 16% year over year. Average rate per contract declined in five product lines.

Financial Update

As of Mar 31, 2019, CME Group had $1.1 billion of cash and marketable securities, down 4.4% from 2018 end. As of Mar 31, 2019, long-term debt of $4.3 billion increased 12.2% from 2018 end.

As of Mar 31, 2019, the company had total assets worth $71.6 billion, down 7.6% from 2018 end.

Zacks Rank

CME Group currently carries a Zacks Rank #3 (Hold).  You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of Other Companies in Securities Exchange Industry

Nasdaq Inc. (NDAQ - Free Report) and MarketAxess Holdings Inc. (MKTX - Free Report) earnings beat the respective Zacks Consensus Estimate.

Upcoming Release

Intercontinental Exchange Inc. (ICE - Free Report) is due to release its first-quarter results on May 2. The Zacks Consensus Estimate for first-quarter earnings is pegged at 89 cents, indicating a decline of 1.1% from the year-ago period reported figure.

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