On Thursday, Oppenheimer maintained its Outperform rating on CME Group (NASDAQ: CME) shares and increased the price target to $258 from the previous $245. This adjustment follows CME Group's (NASDAQ:CME) announcement of a record-setting third quarter, with an adjusted EPS of $2.68, surpassing both Oppenheimer's estimate of $2.61 and the consensus estimate of $2.65.
CME Group's stock experienced a modest increase by the end of the trading day, closing up 0.4%, in contrast to the S&P 500's decline of 0.9%. The analyst pointed to the heightened demand for risk management solutions due to uncertainties surrounding the U.S. election and the geopolitical landscape as a key driver of CME's performance.
The analyst's commentary highlighted a shift in sentiment regarding CME Group, noting reduced concerns over significant price cuts on interest rate products and potential market share loss. This change is attributed to the subdued initial volume of FMX, a futures exchange.
Furthermore, the current trading price of CME Group, which is at a 100% relative multiple, or 22 times next twelve months (NTM) P/E, is well below its long-term historical average of 148% or 32.5 times. According to the analyst, this suggests that CME Group's stock may have further potential for growth.
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