Options exchange operatorCBOE Holdings (
) has improved its picture on earnings and revenue in recent
In Q4, earnings advanced 22%, while revenue grew 8%. In Q1,
the company stoked EPS 35%, while revenue increased 18%.
The first-quarter growth was impressive because trading volume
was lower industrywide.
After-tax margin was 31.2%, the best in six quarters. Pretax
margin last year was 48%, an eight-year high.
The company's three and five-year Earnings Stability Factors
are 7 and 13 respectively. The gauge runs from 0 (calm) to 99
CBOE is the holding company for the Chicago Board Options
Exchange. The midcap company offers equity, index and
exchange-traded funds options.
Exchange stocks went through a merger period when companies
were either making acquisitions or targeted as an acquisition. In
2011, speculation had CBOE as a takeover target.
Mergers can help reduce costs. Once two exchanges merge, they
need only one technology platform.
Further consolidation within the exchange space is
CBOE broke out of a first stage, flat base in early January,
clearing a 31.05 entry in fast trade. The stock is about 30% past
the buy point.
As CBOE advanced, the stock has offered secondary entries.
CBOE formed three-weeks-tight patterns in March and April. On
Friday, the stock completed a three-weeks-tight with a 41.10 buy
The three-weeks-tight pattern can be seen only on the weekly
chart. The pattern involves tight weekly closes from one week to
the next. The buy point is the high of the pattern plus 10
The annualized dividend yield is 1.5%.