CME Group (CME) delivered solid second-quarter results driven by increased trading activities as economies continue to recover. Revenues came in at $1.2 billion versus the $1.18 billion that analysts expected.
Diluted earnings of $1.64 per share beat consensus estimates of $1.61 per share. Adjusted net income totaled $589 million. During the quarter, average daily volume increased 5%, and the company posted double-digit growth in key markets. (See CME Group stock charts on TipRanks)
CME Group also introduced several innovative products to make it easier for customers to tailor their trading and hedging activities on the platform. The company ventured into the sustainability investing space with the unveiling of environmental, social, and governance-focused futures contracts.
CEO Terry Duffy stated, “Looking ahead, we will continue to support our clients’ evolving trading needs through additional product innovation and the upcoming launch of our joint venture company to provide post-trade services for OTC markets.”
Rosenblatt Securities analyst Sean Horgan maintains a Sell rating on the stock with a $192 price target, implying a 10.04% downside potential to current levels. According to the analyst, the company lowered its expense guide to $1.56 billion.
“The lowered expense guidance does not come as a major surprise to us (or likely consensus given where expense estimates were). Net/net, we see the results/guide as in-line with expectations and don’t expect shares to move much in either direction following the report,” Horgan said.
Consensus among analysts is a Hold based on 4 Buys, 6 Holds, and 2 Sells. The average CME Group price target of $212.27 implies that shares are fully-priced at current levels.
CME scores a 6 out of 10 on TipRanks’ Smart Score rating system, suggesting that the stock is likely to perform in line with market averages.
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