Yahoo Finance Here's Why You Should Invest in Cboe Global (CBOE) Stock
Cboe Global Markets’ CBOE optimistic medium-term target, strong market position, global reach, strength in its proprietary products, solid capital position, effective capital deployment along with favorable growth estimates make it worth retaining in one’s portfolio.
CBOE has a decent track record of beating earnings estimates in three of the last four quarters.
It has a VGM Score of B. The VGM Score rates stocks on their combined weighted styles, helping to identify those with the most attractive value, best growth, and most promising momentum. Back-tested results have shown that stocks with a VGM Score of A or B combined with a Zacks Rank #1 (Strong Buy) or #2 (Buy) offer better returns.
Return on Equity
Return on equity, a measure reflecting how efficiently a company utilizes shareholders’ money, was 20.1% in the trailing twelve months, better than the industry average of 13.5%.
Zacks Rank & Price Performance
Cboe Global currently carries a Zacks Rank #2. In the past three months, the stock has gained 4.1%, outperforming the industry’s increase of 3.1%.
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Northbound Estimate Revision
The Zacks Consensus Estimate for 2023 has moved 0.3% north in the past 30 days, reflecting analyst optimism.
Optimistic Growth Projections
The Zacks Consensus Estimate for Cboe Global’s 2023 earnings is pegged at $7.01, indicating a 3.4% increase from the year-ago reported figure on 4.8% higher revenues of $1.8 billion. It has a Growth Score of A. The Growth Style Score analyzes the growth prospects of a company. Back-tested results have shown that stocks with a Growth Score of A or B combined with a Zacks Rank #1 or #2 offer better returns.
Growth Drivers
Cboe Global, the largest stock exchange operator by volume in the United States and a leading market globally for ETP trading, continues to expand its product portfolio. Given a volatile market, its compelling portfolio helps drive trading volumes. Notably, total options volume was 3.4 billion contracts in 2022, the third consecutive record-breaking year, while total options ADV of 13.6 million contracts traded per day in 2022 marked a new all-time high.
Broadening geographic reach to the highest-value markets, diversifying its business mix with recurring revenues, ramping up growth with recurring non-transaction revenues and leveraging technology should continue to boost operational performance and fuel the top line. For the mid-to-long term, CBOE estimates organic top-line compound average growth of 4% to 6%.
Cboe Global Markets has an impressive inorganic growth story. The Bats Global buyout expanded and diversified its portfolio. MATCHNow helped it venture into Canada. BIDS Trading provided a meaningful presence in the substantial off-exchange segment of the U.S. equities market, while Chi-X Asia Pacific Holdings expanded its global equities business into the Asia Pacific region.
Banking on operational excellence, CBOE has been increasing dividends each year since its IPO as well as engaging in share buybacks.
Other Stocks to Consider
Some other top-ranked stocks from the finance sector are Portman Ridge Finance Corporation PTMN, Prospect Capital Corporation PSEC and Allianz SE ALIZY. While Portman Ridge and Prospect Capital sport a Zacks Rank #1, Allianz carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Portman Ridge’s 2023 earnings indicates 2.3% year-over-year growth. In the past year, Portman Ridge’s stock has lost 9.4%.
The Zacks Consensus Estimate for PTMN’s 2023 earnings has moved 9.9% north in the past 60 days.
Prospect Capital’s earnings surpassed estimates in each of the last four quarters, the average surprise being 18.39%. In the past year, Prospect Capital’s stock has lost 19.1%.
The Zacks Consensus Estimate for PSEC’s 2023 earnings per share indicates a year-over-year increase of 2.9%.
Allianz’s earnings surpassed the Zacks Consensus Estimate in each of the last four quarters, the average earnings surprise being 12.96%. In the past six months, the insurer has gained 12.2%.
The Zacks Consensus Estimate for ALIZY’s 2023 earnings has moved 0.8% north in the past 30 days. The Zacks Consensus Estimate for Allianz’s 2023 earnings per share indicates a year-over-year increase of 47.2%.
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Cboe Global Markets, Inc. (CBOE) : Free Stock Analysis Report
Prospect Capital Corporation (PSEC) : Free Stock Analysis Report
Portman Ridge Finance Corporation (PTMN) : Free Stock Analysis Report
Allianz SE (ALIZY) : Free Stock Analysis Report
