We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Why Is CME (CME) Up 11.3% Since Last Earnings Report?
Read MoreHide Full Article
A month has gone by since the last earnings report for CME Group (CME - Free Report) . Shares have added about 11.3% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is CME due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
CME Group Q1 Earnings Beat, Revenues Miss Estimates
CME Group 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.
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.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates.
VGM Scores
Currently, CME has a subpar Growth Score of D, a grade with the same score on the momentum front. Charting a somewhat similar path, the stock was allocated a grade of F on the value side, putting it in the bottom 20% quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise CME has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Why Is CME (CME) Up 11.3% Since Last Earnings Report?
A month has gone by since the last earnings report for CME Group (CME - Free Report) . Shares have added about 11.3% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is CME due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
CME Group Q1 Earnings Beat, Revenues Miss Estimates
CME Group 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.
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.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates.
VGM Scores
Currently, CME has a subpar Growth Score of D, a grade with the same score on the momentum front. Charting a somewhat similar path, the stock was allocated a grade of F on the value side, putting it in the bottom 20% quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise CME has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.