CME Valuation
| CME Stock | USD 208.42 1.94 0.94% |
At this time, the firm appears to be fairly valued. CME Group shows a prevailing Real Value of $209.69 per share. The current price of the firm is $208.42. Our model approximates the value of CME Group from examining the firm fundamentals such as Return On Equity of 0.12, current valuation of 75.1 B, and Profit Margin of 0.58 % as well as evaluating its technical indicators and probability of bankruptcy. In general, most investors favor purchasing undervalued instruments and exiting overvalued instruments since, in the future, asset prices and their ongoing real values will blend.
Fairly Valued
Today
Please note that CME's price fluctuation is very steady at this time. Calculation of the real value of CME Group is based on 3 months time horizon. Increasing CME's time horizon generally increases the accuracy of value calculation and significantly improves the predictive power of the methodology used.
Our valuation method for CME Group is useful when determining the fair value of the CME stock, which is usually determined by what a typical buyer is willing to pay for full or partial control of CME. Since CME is currently traded on the exchange, buyers and sellers on that exchange determine the market value of CME Stock. However, CME's intrinsic value may or may not be the same as its current market price, in which case there is an opportunity to profit from the mispricing, assuming the market price will eventually merge with its intrinsic value. | Historical | Market 208.42 | Real 209.69 | Hype 208.42 | Naive 207.24 |
The real value of CME Stock, also known as its intrinsic value, is the underlying worth of CME Group Company, which is reflected in its stock price. It is based on CME's financial performance, assets, liabilities, growth prospects, management team, or industry conditions. The intrinsic value of CME's stock can be calculated using various methods such as discounted cash flow analysis, price-to-earnings ratio, or price-to-book ratio. That value may differ from its current market price, which is determined by supply and demand factors such as investor sentiment, market trends, news, and other external factors that may influence CME's stock price. It is important to note that the real value of any stock may change over time based on changes in the company's performance.
Estimating the potential upside or downside of CME Group helps investors to forecast how CME stock's addition to their portfolios will impact the overall performance. We also use other valuation drivers to help us estimate the true value of CME more accurately as focusing exclusively on CME's fundamentals will not take into account other important factors: CME Valuation Ratios as Compared to Competition
Comparative valuation techniques use various fundamental indicators to help in determining CME's current stock value. Our valuation model uses many indicators to compare CME value to that of its competitors to determine the firm's financial worth. You can analyze the relationship between different fundamental ratios across CME competition to find correlations between indicators driving CME's intrinsic value. More Info.CME Group is rated fourth in price to earning category among related companies. It is rated below average in price to book category among related companies fabricating about 0.09 of Price To Book per Price To Earning. The ratio of Price To Earning to Price To Book for CME Group is roughly 11.64 . Comparative valuation analysis is a catch-all model that can be used if you cannot value CME by discounting back its dividends or cash flows. This model doesn't attempt to find an intrinsic value for CME's Stock. Still, instead, it compares the stock's price multiples to a benchmark or nearest competition to determine if the stock is relatively undervalued or overvalued. The reason why the comparable model can be used in almost all circumstances is due to the vast number of multiples that can be utilized, such as the price-to-earnings (P/E), price-to-book (P/B), price-to-sales (P/S), price-to-cash flow (P/CF), and many others. The P/E ratio is the most commonly used of these ratios because it focuses on the CME's earnings, one of the primary drivers of an investment's value.Please note that valuation analysis is one of the essential comprehensive assessments in business. It evaluates CME's worth, which you can determine by considering its current assets, liabilities and future cash flows. The investors' valuation analysis is an important metric that will give you a perspective on different companies. It helps you know the worth of the potential investment in CME and how it compares across the competition.
About CME Valuation
The stock valuation mechanism determines the current worth of CME Group on a weekly basis. We use both absolute as well as relative valuation methodologies to arrive at the intrinsic value of CME Group. In general, an absolute valuation paradigm, as applied to this company, attempts to find the value of CME Group based exclusively on its fundamental and basic technical indicators. By analyzing CME's financials, quarterly and monthly indicators, and its related drivers such as dividends, operating cash flow, and various types of growth rates, we attempt to find the most accurate representation of CME's intrinsic value. In some cases, mostly for established, large-cap companies, we also incorporate more traditional valuation methods such as dividend discount, discounted cash flow, or asset-based models. As compared to an absolute model, our relative valuation model uses a comparative analysis of CME. We calculate exposure to CME's market risk, different technical and fundamental indicators, relevant financial multiples and ratios, and then comparing them to CME's related companies.CME Group Inc., together with its subsidiaries, operates contract markets for the trading of futures and options on futures contracts worldwide. CME Group Inc. was founded in 1898 and is headquartered in Chicago, Illinois. CME operates under Financial Data Stock Exchanges classification in the United States and is traded on NASDAQ Exchange. It employs 3480 people.
8 Steps to conduct CME's Valuation Analysis
Company's valuation is the process of determining the worth of any company in monetary terms. It estimates CME's potential worth based on factors such as financial performance, market conditions, growth prospects, and overall economic environment. The result of company valuation is a single number representing a Company's current market value. This value can be used as a benchmark for various financial transactions such as mergers and acquisitions, initial public offerings (IPOs), or private equity investments. To conduct CME's valuation analysis, follow these 8 steps:- Gather financial information: Obtain CME's financial statements, including balance sheets, income statements, and cash flow statements.
- Determine CME's revenue streams: Identify CME's primary sources of revenue, including products or services offered, target markets, and pricing strategies.
- Analyze market data: Research CME's industry and market trends, including the size of the market, growth rate, and competition.
- Establish CME's growth potential: Evaluate CME's management, business model, and growth potential.
- Determine CME's financial performance: Analyze its financial statements to assess its historical performance and future potential.
- Choose a valuation method: Consider the Company's specific circumstances and choose an appropriate valuation method, such as the discounted cash flow (DCF) or comparable analysis method.
- Calculate the value: Apply the chosen valuation method to the financial information and market data to calculate CME's estimated value.
- Review and adjust: Review the results and make necessary adjustments, considering any relevant factors that may have been missed or overlooked.
A single share of CME represents a small ownership stake in the entity. As a stockholder of CME, your percentage of company ownership is determined by dividing the number of shares you own by the total number of shares outstanding and then multiplying that amount by 100. Owning stock in a company generally confers both corporate voting rights and income from any dividends paid to the stock owner.
CME Dividends Analysis For Valuation
There are various types of dividends CME can pay to its shareholders, and the actual value of the dividend is determined on a per-share basis. It is to be paid equally to all of CME shareholders on a specific date, known as the payable date. The cash dividend is the most common type of dividend payment - it is the payment of actual cash from CME Group directly to its shareholders. There are other types of dividends that companies can issue, such as stock dividends or asset dividends. When CME pays a dividend, it has no impact on its enterprise value. It does, however, lowers the Equity Value of CME by the value of the dividends paid out.
CME Growth Indicators
Growth stocks usually refer to those companies expected to grow sales and earnings faster than the market average. Growth stocks typically don't pay dividends, often look expensive, and usually trading at a high P/E ratio. Nevertheless, such valuations could be relatively cheap if the company continues to grow, which will drive the share price up. However, since most investors are paying a high price for a growth stock, based on expectations, if those expectations are not fully realized, growth stocks can see dramatic declines. Note, investing in growth stocks can be very risky. If the company such as CME does not do well, investors take a loss on the stock when it is time to sell. Also, because growth stocks typically do not pay dividends, the only opportunity an investor has to make money on their investment is when they eventually sell their shares.
| Common Stock Shares Outstanding | 359.5 M | |
| Quarterly Earnings Growth Y O Y | 0.276 | |
| Forward Price Earnings | 21.8818 |
Check out Trending Equities to better understand how to build diversified portfolios, which includes a position in CME Group. Also, note that the market value of any company could be tightly coupled with the direction of predictive economic indicators such as signals in population. You can also try the Stocks Directory module to find actively traded stocks across global markets.
Complementary Tools for CME Stock analysis
When running CME's price analysis, check to measure CME's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy CME is operating at the current time. Most of CME's value examination focuses on studying past and present price action to predict the probability of CME's future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move CME's price. Additionally, you may evaluate how the addition of CME to your portfolios can decrease your overall portfolio volatility.
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Is CME's industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of CME. If investors know CME will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about CME listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
The market value of CME Group is measured differently than its book value, which is the value of CME that is recorded on the company's balance sheet. Investors also form their own opinion of CME's value that differs from its market value or its book value, called intrinsic value, which is CME's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because CME's market value can be influenced by many factors that don't directly affect CME's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between CME's value and its price as these two are different measures arrived at by different means. Investors typically determine if CME is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, CME's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.