CME price ascent is misleading

In spite of rather unsteady fundamental drivers, CME exhibited solid returns over the last few months and may actually be approaching a breakup point. We found thirty-eight available fundamental indicators for CME Group which can be compared to its rivals. To make sure the equity is not overpriced, please confirm all CME Group fundamentals including its Current Valuation, Price to Book, Cash and Equivalents, as well as the relationship between Shares Owned by Institutions and Gross Profit . Given that CME Group has Price to Earning of 34.39X, we suggest you validate CME Group prevailing market performance to make sure the company can sustain itself in the future. Use CME to enhance returns of your portfolios. The stock experiences large bullish trend. Check odds of CME to be traded at $209.57 in 30 days.
Published over a year ago
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Reviewed by Gabriel Shpitalnik

This firm has 4.85B in debt with debt to equity (D/E) ratio of 18.5 . This implies that CME may be unable to create cash to meet all of its financial commitments. The company has Current Ratio of 1.02 demonstrating that it is in a questionable position to pay out its financial commitments when the payables are due. CME dividends can provide a clue to current valuation of the stock. The firm one year expected dividend income is about $2.29 per share. About 88.0% of the company shares are held by institutions such as insurance companies. The book value of CME was currently reported as 73.27. The company recorded earning per share (EPS) of 5.35. CME Group last dividend was issued on 2019-06-07. The entity had 5:1 split on 2012-07-23.
Typically, a company's financial statements are the reports that show the financial position of the company. There are three main documents that fall into the category of financial statements. These documents include CME income statement, its balance sheet, and the statement of cash flows. Potential CME investors and stakeholders use financial statements to determine how well the company is positioned to perform in the future. Although CME investors may use each financial statement separately, they are all related. The changes in CME's assets and liabilities, for example, are also reflected in the revenues and expenses that we see on CME's income statement, which results in the company's gains or losses. Cash flows can provide more information regarding cash listed on a balance sheet, but not equivalent to net income shown on the income statement. Please read more on our technical analysis and fundamental analysis pages.
The goal of CME fundamental analysis is to do accurate financial forecasts. There are several possible objectives to fundamental analysis, such as projecting of CME performance into the future periods or doing a reasonable stock valuation. The intrinsic value of CME shares is the value that is considered the true value of the share. If the intrinsic value of CME is higher than its market price, buying is generally recommended. If it is equal to the market price, it is recommended to hold; and if it is less than the market price, then one should sell all shares CME. Please read more on our fundamental analysis page.

How effective is CME in utilizing its assets?

CME Group reports assets on its Balance Sheet. It represents the amount of CME resources that either has an existing economic value or will provide some form of benefits in the future. By effectively utilizing its assets, CME aims to generate revenue, control costs, drive operational efficiency, and enhance profitability. Optimizing asset utilization helps maximize shareholder value and maintain a competitive position in the Financial Exchanges & Data space. To get a better handle on how balance sheet or income statements item affect CME volatility, please check the breakdown of all its fundamentals.

Are CME Earnings Expected to grow?

The future earnings power of CME involves the interaction of many company-specific, industry, and economic forces. Earnings estimates embody investors' opinions of CME factors such as sales growth, product demand, competitive industry environment, profit margins, and cost controls. CME stock prices adjust as these expectations change or are proven wrong. The main thing to remember is that equities with high expected earnings growth tend to underperform the market because it is usually difficult to meet the market's high expectations. Companies with low earnings expectations tend to do better than expected. Please use our latest analysis of CME expected earnings.

And What about dividends?

A dividend is the distribution of a portion of CME earnings, decided and managed by the company's board of directors and paid to a class of its shareholders. Note, announcements of dividend payouts are generally accompanied by a proportional increase or decrease in a company's stock price. CME dividend payments follow a chronological order of events, and the associated dates are important to determine the shareholders who qualify for receiving the dividend payment. CME one year expected dividend income is about USD6.05 per share.
At present, CME's Dividend Paid And Capex Coverage Ratio is projected to slightly decrease based on the last few years of reporting.
Last ReportedProjected for 2024
Dividends Paid3.2 B3.4 B
Dividend Yield 0.04  0.02 
Dividend Payout Ratio 1.00  0.56 
Dividend Paid And Capex Coverage Ratio 1.09  1.15 
Investing in dividend-paying stocks, such as CME Group is one of the few strategies that are good for long-term investment. Ex-dividend dates are significant because investors in CME must own a stock before its ex-dividend date to receive its next dividend.
This type of analysis is very useful when you want to generate a past dividend schedule and payout information for CME. Then that information in the form of graph and calendar can be used to fully explain how Du Pont dividends can provide a real clue to its valuation.

Breaking it down

CME Group has beta of 0.08. As returns on market increase, CME returns are expected to increase less than the market. However during bear market, the loss on holding CME will be expected to be smaller as well. The latest increase in of CME short term price appreciation could raise concerns from investors as the firm closed today at a share price of 187.32 on 2007189.000 in volume. The company executives have been quite successful with maneuvering the fund at opportune times to take advantage of all market conditions in April. The stock standard deviation of daily returns for 30 days (very short) investing horizon is currently 0.899. The very small Stock volatility is a good signal to investors with longer term investment horizons. CME preserves 3.0 of last dividend paid. CME is selling for under 190.52. That is 1.74 percent increase. Day high is 190.78. CME Tax Liabilities is increasing over the last 5 years. The previous year value of CME Tax Liabilities was 6,439,090,105. CME Total Liabilities is rather stable at the moment. Furthermore, CME Capital Expenditure is decreasing over the last 5 years. The previous year value of CME Capital Expenditure was 110,192,523.
 2013 2014 2015 2016 2018 (projected)
CME Current Assets 24,405,600,000  42,545,300,000  37,904,500,000  40,031,500,000  36,028,350,000 
CME Total Assets 54,277,800,000  72,241,500,000  67,359,400,000  69,369,400,000  62,432,460,000 
All things considered, our research shows that CME is very steady with very low probability of bankruptcy in the next two years. Our overall buy vs. sell advice on the firm is Strong Hold.

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Editorial Staff

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Vlad Skutelnik do not own shares of CME Group. Please refer to our Terms of Use for any information regarding our disclosure principles.

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