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What's in Store for Cboe Global (CBOE) This Earnings Season?

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Cboe Global Markets, Inc. (CBOE - Free Report) is slated to report second-quarter 2020 results on Jul 31, before the opening bell. The company has a trailing four-quarter earnings surprise of 8.24%, on average.

Factors to Note

CBOE Global’s second-quarter performance is likely to have benefited from higher market data fees and access and capacity fees, partially offset by lower transactions fees and regulatory fees. The Zacks Consensus Estimate for second-quarter market data fees, and access and capacity fees are pegged at $57 million each, indicating growth of 10% and 4.6%, respectively, from the prior-year quarter.

Notably, the Zacks Consensus Estimate for second-quarter revenues is pegged at $297 million, indicating an improvement of 4.9% from the year-ago reported figure.

However, lower transaction fees, which are likely to reflect lower trading volumes in Options, U.S. Equities and Futures, might have weighed on the second-quarter top line. The consensus mark for second-quarter transaction fees is pegged at $332 million, indicating a decline of 22.2% from the prior-year quarter.

Nevertheless, with respect to revenues per contract (RPC), Cboe Global estimates second-quarter Options RPC to be in line to up 1% from the two months ended May 31 average, primarily attributable to higher RPC projected for multi-listed options for June, which in turn have been driven by lower volume-related rebates in June. RPC for Futures is expected to be in line with the two-month ended May 31 average.

Moreover, CBOE Global is likely to have benefited by its strong proprietary products, particularly SPX index options and VIX Futures despite the COVID-19 induced market volatility. The company’s buyout of Hanweck and FT Options this February bodes well as these primarily provide portfolio risk management solutions, which have been in strong demand among its clients of late.

Furthermore, the company might have gained from synergies derived from its acquisition of Bats Global, which is likely to have streamlined expense structure. Evidently, the company’s total operating expenses are likely to have declined in the to-be-reported quarter, primarily due to reduced compensation costs and fall in expenses for travel and entertainment and marketing events on account of the current environment.

The Zacks Consensus Estimate for second-quarter earnings per share is pegged at $1.25, indicating growth of 10.6% from the prior-year quarter.

Cboe Global Markets, Inc. Price and EPS Surprise

Cboe Global Markets, Inc. Price and EPS Surprise

Cboe Global Markets, Inc. price-eps-surprise | Cboe Global Markets, Inc. Quote

What the Zacks Model Says

Our proven model predicts an earnings beat for CBOE Global this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.

Earnings ESP: CBOE Global has an Earnings ESP of +0.48%. This is because both the Most Accurate Estimate and the Zacks Consensus Estimate are pegged at $1.25 per share. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: CBOE Global carries a Zacks Rank of 3.

Other Stocks to Consider

Some other stocks worth considering from the finance sector with a perfect mix of elements to surpass estimates in the upcoming quarterly releases are as follows:

Apollo Global Management, Inc. (APO - Free Report) has an Earnings ESP of +2.96% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Moody's Corporation (MCO - Free Report) has an Earnings ESP of +2.14% and a Zacks Rank of 3, at present.

Acadia Realty Trust (AKR - Free Report) has an Earnings ESP of +0.81% and a Zacks Rank #3.

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