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CME Group (CME) Q4 Earnings & Revenues Surpass Estimates
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CME Group Inc. (CME - Free Report) reported fourth-quarter 2023 record adjusted earnings per share of $2.37, which beat the Zacks Consensus Estimate by 4.4%. The bottom line increased 23.4% year over year.
Quarterly results benefited from an increase in trading volumes. Average daily volume increased in five of its six asset classes.
CME Group’s revenues of $1.4 billion increased 19.2% year over year. The year-over-year increase was primarily due to higher clearing and transaction fees (up 20.7% year over year), market data and information services (up 9.1% year over year) and other (up 19.7% year over year). Revenues beat the Zacks Consensus Estimate by 0.9%.
Total expenses increased 6.8% year over year to $576.1 million, attributable to higher compensation and benefits, technology, licensing and other fee agreements and other expenses. Our estimate was $479.7 million.
Operating income increased 29.2% from the prior-year quarter to $863.2 million but missed our estimate of $939.4 million.
Average daily volume (ADV) was 25.5 million contracts, which increased 17% year over year. Non-U.S. ADV reached 7.2 million contracts, up 28% year over year.
The total average rate per contract was 68.2 cents.
Full-Year Highlights
Adjusted earnings per share of $9.34 beat the Zacks Consensus Estimate of $9.24. The bottom line increased 17.1% year over year.
CME Group’s revenues of $5.6 billion increased 11.1% year over year. The top line was in line with the Zacks Consensus Estimate.
Financial Update
As of Dec 31, 2023, CME Group had $3 billion of cash and marketable securities, up 7.4% from 2022 end. As of Dec 31, 2023, long-term debt was $3.4 billion, which inched up 0.08% from 2022 end.
As of Dec 31, 2023, CME had shareholders' equity worth $26.7 billion, down 0.5% from 2022 end.
Capital Deployment
CME Group paid out $24.3 billion in dividends, since the implementation of the variable dividend policy in early 2012.
On Feb 8, 2024, CME Group raised its first-quarter dividend to $1.15 per share from the prior level of $1.10.
MarketAxess Holdings Inc. (MKTX - Free Report) reported strong fourth-quarter 2023 results aided by higher commissions and trading volumes. Continued solid Eurobonds’ performance further aided its business. The positives were partially offset by an elevated expense level and a lower High-yield credit trading.
Its fourth-quarter 2023 earnings per share of $1.84 beat the Zacks Consensus Estimate by 7%. Moreover, the bottom line increased from $1.58 per share a year ago. Total revenues increased 10.9% year over year to $197.2 million in the quarter under review. Also, the top line beat the consensus mark by 0.7%.
Nasdaq Inc. (NDAQ - Free Report) reported fourth-quarter 2023 adjusted earnings per share of 72 cents, beating the Zacks Consensus Estimate by 2.9%. The bottom line improved 12.5% year over year. Nasdaq’s revenues of $1.1 billion increased 23% year over year. The upside can primarily be attributed to a 7% impact from organic growth, net benefit from acquisitions and divestitures, including Adenza and a $4 million increase from the impact of changes in FX rates. The top line beat the Zacks Consensus Estimate by 5%.
Annualized Recurring Revenue (ARR) increased 29% year over year. Annualized SaaS revenues rose 23% and represented 35% of ARR. Market Services net revenues were $247 million, up 1%. The increase reflects $1 million in organic growth and a $1 million positive impact from changes in FX rates. Revenues at the Solutions business increased 32% year over year to $860 million, reflecting growth from the Capital Access Platforms and Financial Technology divisions. Organic growth was 9%.
Cboe Global Markets, Inc. (CBOE - Free Report) reported fourth-quarter 2023 adjusted earnings of $2.06 per share, which outpaced the Zacks Consensus Estimate by 2%. The bottom line increased 14% year over year. Total adjusted revenues of CBOE Global were $499 million, which increased 9% year over year, driven by a rise in derivatives markets and data and access solutions net revenues, partially offset by a decrease in cash and spot markets net revenues. The top line missed the consensus mark by 1.2%.
Options revenues climbed 15% year over year to $314.5 million. The growth was driven by an increase in net transaction and clearing fees, as well as growth in access and capacity fees. Revenues of North American Equities totaled $86.3 million, down 10% year over year, mainly due to lower net transaction and clearing fees and industry market data. Europe and Asia Pacific revenues increased 9% year over year to $48 million, driven by double-digit non-transaction revenue growth led by higher market data fees, access and capacity fees, and other revenues.
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CME Group (CME) Q4 Earnings & Revenues Surpass Estimates
CME Group Inc. (CME - Free Report) reported fourth-quarter 2023 record adjusted earnings per share of $2.37, which beat the Zacks Consensus Estimate by 4.4%. The bottom line increased 23.4% year over year.
Quarterly results benefited from an increase in trading volumes. Average daily volume increased in five of its six asset classes.
CME Group Inc. Price, Consensus and EPS Surprise
CME Group Inc. price-consensus-eps-surprise-chart | CME Group Inc. Quote
Performance in Detail
CME Group’s revenues of $1.4 billion increased 19.2% year over year. The year-over-year increase was primarily due to higher clearing and transaction fees (up 20.7% year over year), market data and information services (up 9.1% year over year) and other (up 19.7% year over year). Revenues beat the Zacks Consensus Estimate by 0.9%.
Total expenses increased 6.8% year over year to $576.1 million, attributable to higher compensation and benefits, technology, licensing and other fee agreements and other expenses. Our estimate was $479.7 million.
Operating income increased 29.2% from the prior-year quarter to $863.2 million but missed our estimate of $939.4 million.
Average daily volume (ADV) was 25.5 million contracts, which increased 17% year over year. Non-U.S. ADV reached 7.2 million contracts, up 28% year over year.
The total average rate per contract was 68.2 cents.
Full-Year Highlights
Adjusted earnings per share of $9.34 beat the Zacks Consensus Estimate of $9.24. The bottom line increased 17.1% year over year.
CME Group’s revenues of $5.6 billion increased 11.1% year over year. The top line was in line with the Zacks Consensus Estimate.
Financial Update
As of Dec 31, 2023, CME Group had $3 billion of cash and marketable securities, up 7.4% from 2022 end. As of Dec 31, 2023, long-term debt was $3.4 billion, which inched up 0.08% from 2022 end.
As of Dec 31, 2023, CME had shareholders' equity worth $26.7 billion, down 0.5% from 2022 end.
Capital Deployment
CME Group paid out $24.3 billion in dividends, since the implementation of the variable dividend policy in early 2012.
On Feb 8, 2024, CME Group raised its first-quarter dividend to $1.15 per share from the prior level of $1.10.
Zacks Rank
CME 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 Securities and Exchanges
MarketAxess Holdings Inc. (MKTX - Free Report) reported strong fourth-quarter 2023 results aided by higher commissions and trading volumes. Continued solid Eurobonds’ performance further aided its business. The positives were partially offset by an elevated expense level and a lower High-yield credit trading.
Its fourth-quarter 2023 earnings per share of $1.84 beat the Zacks Consensus Estimate by 7%. Moreover, the bottom line increased from $1.58 per share a year ago. Total revenues increased 10.9% year over year to $197.2 million in the quarter under review. Also, the top line beat the consensus mark by 0.7%.
Nasdaq Inc. (NDAQ - Free Report) reported fourth-quarter 2023 adjusted earnings per share of 72 cents, beating the Zacks Consensus Estimate by 2.9%. The bottom line improved 12.5% year over year. Nasdaq’s revenues of $1.1 billion increased 23% year over year. The upside can primarily be attributed to a 7% impact from organic growth, net benefit from acquisitions and divestitures, including Adenza and a $4 million increase from the impact of changes in FX rates. The top line beat the Zacks Consensus Estimate by 5%.
Annualized Recurring Revenue (ARR) increased 29% year over year. Annualized SaaS revenues rose 23% and represented 35% of ARR. Market Services net revenues were $247 million, up 1%. The increase reflects $1 million in organic growth and a $1 million positive impact from changes in FX rates. Revenues at the Solutions business increased 32% year over year to $860 million, reflecting growth from the Capital Access Platforms and Financial Technology divisions. Organic growth was 9%.
Cboe Global Markets, Inc. (CBOE - Free Report) reported fourth-quarter 2023 adjusted earnings of $2.06 per share, which outpaced the Zacks Consensus Estimate by 2%. The bottom line increased 14% year over year. Total adjusted revenues of CBOE Global were $499 million, which increased 9% year over year, driven by a rise in derivatives markets and data and access solutions net revenues, partially offset by a decrease in cash and spot markets net revenues. The top line missed the consensus mark by 1.2%.
Options revenues climbed 15% year over year to $314.5 million. The growth was driven by an increase in net transaction and clearing fees, as well as growth in access and capacity fees. Revenues of North American Equities totaled $86.3 million, down 10% year over year, mainly due to lower net transaction and clearing fees and industry market data. Europe and Asia Pacific revenues increased 9% year over year to $48 million, driven by double-digit non-transaction revenue growth led by higher market data fees, access and capacity fees, and other revenues.