Morningstar Rating

Stock Research and Analysis

by Stephen Ellis

Bulls Say

Continued investor interest in derivatives trading will keep feeding CME's volume and profits. In an age when defensible business models are hard to come by, CME's clearinghouse business gives the company unique control over its revenue stream.
The over-the-counter derivatives market is a good avenue for future growth at CME.
CME’s planned acquisition of Trayport and FENICS should open doors for the company in important markets, such as Europe and Asia. Read more 

Bears Say

The headier days of high volume growth may be increasingly rare going forward, which would limit CME's profit growth.
CME's strong position in the derivatives market is attracting more interest from rivals and regulators, which may act in ways that hurt the company's moat and profitability in the years ahead.
CME is now paying the price for its acquisition spree, as its returns are lagging. Read more 

Management

We view CME Group's stewardship of shareholder capital as Standard. The company's board splits the roles of chairman and CEO, an arrangement we generally favor. CME's leadership has extensive experience in the futures business, so we view the company   Read more 

Profile

Based in Chicago, CME Group operates four U.S. financial exchanges. The company's roots stretch back to the 19th century; it became a shareholder-owned corporation in 2000   Read more 

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