On Jun 25, Zacks Investment Research upgraded CBOE
Holdings, Inc . ( CBOE ) to a Zacks Rank
#1 (Strong Buy).CBOE HOLDINGS (CBOE): Free Stock Analysis
ReportCME GROUP INC (CME): Free Stock Analysis ReportMARKETAXESS HLD (MKTX): Free Stock Analysis
ReportNASDAQ OMX GRP (NDAQ): Free Stock Analysis
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Why the Upgrade?
CBOE Holdings has been witnessing rising earnings estimates on the
back of strong first-quarter results followed by sturdy trading
volume in May. Moreover, this securities exchange delivered
positive earnings surprises in the last 4 quarters with an average
beat of 7.4%. The long-term expected earnings growth rate for this
stock is 11.5%.
CBOE Holdings reported first quarter results on May 3. Non-GAAP
earnings per share came in at 48 cents, surpassing the Zacks
Consensus Estimate of 47 cents by 2.1% and the year-ago earnings of
37 cents by 35%.
Earnings were primarily aided by strong growth in the proprietary
products of CBOE. Trading volume in the VIX Index options and
futures reached new records, while trading in the S&P 500
options complex also increased considerably, driven by an increase
in SPX Weeklys.
Additionally, trading volumes in May touched the highest mark in
2013. May trading volume for options contracts on CBOE and C2
Options Exchange (C2SM) and futures contracts on CBOE Futures
Exchange, LLC (CFE®) totaled 107.14 million contracts.
Average daily volume in May improved 4% sequentially to 4.87
CBOE Holdings also rewards its shareholders with a dividend yield
of 1.36%. However, it lags the yield of other securities exchanges
like The Nasdaq OMX Group, Inc. ( NDAQ ) (1.61%) and
CME Group Inc. ( CME ) (2.36%).
The Zacks Consensus Estimate for 2013 increased 4.2% to $1.99 per
share as most of the estimates were revised higher over the last 60
days. For 2014, 5 of 12 estimates were revised higher over the same
period, lifting the Zacks Consensus Estimate by 5.1% to $2.26 per
Other Stock to Consider
Apart from CBOE Holdings, MarketAxess Holdings
Inc . ( MKTX ), which carries
a Zacks Rank #2 (Buy), is worth considering.