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Bull of the Day: CBOE Holdings (CBOE)

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If you are looking for a finance stock that could be on the move, there isn’t really a need to look beyond CBOE Holdings ((CBOE - Free Report) ). The company is quickly diversifying its business across the trading landscape, and was actually just added to the S&P 500 index earlier in the year too. Add that to their strategic acquisition of BATS, and the company is setting itself up for strength in a variety of areas, including the quickly-growing segment of Exchange-Traded Funds.

But even beyond growth opportunities, CBOE is doing a great job in the SPX options market. Revenues were up in this key area for their most recent report , and market share crossed the 40% mark too. Volumes are also accelerating in this area, up 15% year-over-year, and 40% when comparing 2016 to 2012 figures; options volume is clearly moving in the right direction.

There is definitely a lot to like about CBOE right now, and that will only be more apparent if volatility levels pick back up and increase demand for index options, and VIX-linked instruments too. No wonder analysts have been raising their estimates for CBOE stock as of late, and why more strength could be ahead in shares of CBOE too.

Analyst Activity

We have seen near universal agreement among covering analysts on the prospects for CBOE in the near-term. For the current year, we have seen six estimates go higher in the past sixty days compared to zero lower, while the next year time frame has seen seven estimates go higher compared to zero lower.

The magnitude of these estimate increases has also had an impressive impact on the consensus. The full year consensus has increased by about 10% in the past sixty days, while the following year consensus has gone higher by close to 6.5% in the same time frame.

CBOE also has a great history of living up to earnings expectations, while the most accurate estimate is also higher than the consensus right now. This suggests that the most recent estimates have been even more bullish about CBOE’s earnings prospects, which is usually a good sign of things to come.

CBOE Holdings, Inc. Price, Consensus and EPS Surprise

CBOE Holdings, Inc. Price, Consensus and EPS Surprise | CBOE Holdings, Inc. Quote

Add in a top 10% industry rank for CBOE’s segment, and it shouldn’t be a surprise that we have CBOE at a Zacks Rank #1 (Strong Buy) stock right now. In other words, we are looking for the strength in this company to continue in the near-term.

Bottom Line

There is a lot to like about CBOE from an earnings estimate perspective. Analysts have near-universal agreement regarding the improving company prospects, while there is solid EPS growth projected into the future.

Add in some recent outside factors—including getting on the most important index in America and scooping up BATS—and CBOE is in an enviable position right now. So, if you want to take a closer look at a financial name these days, definitely put CBOE on your radar as a great candidate.


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