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CME Group Hits 52- Week High on Product Launch, Volumes


On Sep 16, 2016, shares of CME Group Inc. CME scaled a new 52-week high of $109.80. The upside was driven by product launch and sturdy August volumes. About 1.7 million shares exchanged hands in the last trading session and the stock finally closed at $109.65, up 0.34%. Year to date, the stock has returned 21.03%, which is substantially above 4.74% returned by Nasdaq.

Last week, CME Group unveiled the first-ever, exchange-traded precious metals spread and ratio futures contracts. The market participants will now be able to better manage precious metals price relationships using these contracts. The three newly launched contracts include Gold/Silver Ratio futures, Gold/Platinum Spread futures and Platinum/Palladium Spread futures. CME Group has been driving its growth by strategically offering different types of futures contracts. This, in turn, makes its portfolio a compelling one.

Also, CME Group’s average daily volume for August was 13.8 million contracts per day. Average daily volume for the first eight months improved by 9% to 5.5 million contracts per day. Total open interest of 105 million contracts at the end of August increased 15% over year-end 2015. The company has been able to continually drive growth in average daily volumes owing to its solid operating leverage.

Riding on the core strength, the Zacks Consensus Estimate has also moved up 2.5% for both 2016 and 2017, over the last 60 days.

Continuous focus on expanding and cross sell through strategic alliances, acquisitions, new product initiatives and global presence should drive growth for CME Group. The expected long-term earnings growth rate is pegged at 9.6%.

CME GROUP INC Price and Consensus

CME GROUP INC Price and Consensus | CME GROUP INC Quote

Zacks Rank and Stocks to Consider

CME Group presently carries a Zacks Rank #2 (Buy). Other well-ranked stocks from the finance industry include MarketAxess Holdings Inc. MKTX, Allied World Assurance Company Holdings, AG AWH and National Interstate Corporation NATL. While both Allied World Assurance and National Interstate sport a Zacks Rank #1 (Strong Buy), MarketAxess carries Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

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