Junto Capital Management LP Takes Position in CME Group Inc. $CME

Key Points

• Junto Capital Management LP acquired a new stake of 308,404 shares in CME Group valued at approximately $83.3M, representing 1.7% of Junto’s portfolio while institutional investors own about 87.75% of CME.
• CME slightly beat the quarter with EPS $2.77 versus $2.75 and revenue of $1.65B (up 8.1% YoY), and raised its quarterly dividend to $1.30 (annualized $5.20, yield ~1.7%; ex-dividend March 10).
• Analyst views are mixed — the consensus rating is "Hold" with a $303.53 price target (some firms raised targets, e.g., Rothschild to $347) — and insiders have sold roughly 5,248 shares (~$1.62M) in the past three months, a potential governance/owner-sentiment flag.

Junto Capital Management LP acquired a new stake in shares of CME Group Inc. (NASDAQ:CME - Free Report) during the third quarter, according to the company in its most recent filing with the Securities & Exchange Commission. The firm acquired 308,404 shares of the financial services provider's stock, valued at approximately $83,328,000. CME Group accounts for 1.7% of Junto Capital Management LP's portfolio, making the stock its 21st biggest position. Junto Capital Management LP owned about 0.09% of CME Group at the end of the most recent reporting period.

Several other hedge funds and other institutional investors have also recently added to or reduced their stakes in CME. KKM Financial LLC boosted its stake in CME Group by 24.3% during the 3rd quarter. KKM Financial LLC now owns 17,748 shares of the financial services provider's stock valued at $4,795,000 after purchasing an additional 3,468 shares in the last quarter. Hilltop Holdings Inc. raised its stake in shares of CME Group by 105.7% in the 3rd quarter. Hilltop Holdings Inc. now owns 10,534 shares of the financial services provider's stock worth $2,846,000 after buying an additional 5,413 shares in the last quarter. Holocene Advisors LP acquired a new stake in shares of CME Group in the third quarter valued at $72,570,000. Gotham Asset Management LLC boosted its stake in CME Group by 41.0% during the third quarter. Gotham Asset Management LLC now owns 173,236 shares of the financial services provider's stock valued at $46,807,000 after buying an additional 50,402 shares in the last quarter. Finally, Fayez Sarofim & Co grew its holdings in CME Group by 0.6% during the third quarter. Fayez Sarofim & Co now owns 1,249,296 shares of the financial services provider's stock worth $337,547,000 after acquiring an additional 7,866 shares during the period. Institutional investors own 87.75% of the company's stock.

Analyst Ratings Changes

CME has been the subject of a number of research analyst reports. Erste Group Bank raised shares of CME Group from a "hold" rating to a "strong-buy" rating in a report on Thursday, March 5th. Raymond James Financial cut their target price on shares of CME Group from $311.00 to $310.00 and set an "outperform" rating for the company in a research note on Wednesday, February 4th. Royal Bank Of Canada raised their target price on shares of CME Group from $295.00 to $302.00 and gave the stock a "sector perform" rating in a report on Thursday, February 5th. Bank of America lifted their price target on shares of CME Group from $201.00 to $209.00 in a research report on Wednesday, December 10th. Finally, JPMorgan Chase & Co. increased their price objective on CME Group from $262.00 to $266.00 and gave the company an "underweight" rating in a research report on Thursday, February 5th. Two equities research analysts have rated the stock with a Strong Buy rating, eight have given a Buy rating, six have issued a Hold rating and three have issued a Sell rating to the company's stock. According to MarketBeat.com, the stock presently has a consensus rating of "Hold" and a consensus price target of $303.53.

CME Group Stock Up 0.1%

CME stock opened at $311.40 on Monday. The firm has a 50-day moving average price of $295.80 and a 200-day moving average price of $279.06. CME Group Inc. has a 12 month low of $248.53 and a 12 month high of $329.16. The company has a current ratio of 1.03, a quick ratio of 1.03 and a debt-to-equity ratio of 0.12. The stock has a market capitalization of $112.29 billion, a P/E ratio of 27.90, a price-to-earnings-growth ratio of 3.36 and a beta of 0.24.

CME Group (NASDAQ:CME - Get Free Report) last announced its quarterly earnings results on Wednesday, February 4th. The financial services provider reported $2.77 earnings per share (EPS) for the quarter, beating the consensus estimate of $2.75 by $0.02. The company had revenue of $1.65 billion for the quarter, compared to analyst estimates of $1.64 billion. CME Group had a net margin of 62.45% and a return on equity of 14.65%. The firm's revenue was up 8.1% on a year-over-year basis. During the same period in the previous year, the firm posted $2.52 EPS. As a group, equities research analysts anticipate that CME Group Inc. will post 10.49 EPS for the current fiscal year.

CME Group Increases Dividend

The business also recently announced a quarterly dividend, which will be paid on Thursday, March 26th. Shareholders of record on Tuesday, March 10th will be paid a dividend of $1.30 per share. The ex-dividend date of this dividend is Tuesday, March 10th. This is a boost from CME Group's previous quarterly dividend of $1.25. This represents a $5.20 dividend on an annualized basis and a dividend yield of 1.7%. CME Group's payout ratio is presently 46.59%.

Key Stories Impacting CME Group

Here are the key news stories impacting CME Group this week:

• Positive Sentiment: Rothschild & Co Redburn raised its price target on CME to $347 (maintaining a "neutral" rating), implying roughly double-digit upside from recent levels and offering fresh analyst support for the shares. Rothschild Co Redburn adjusts price target on CME to 347 from 333, maintains neutral rating
• Neutral Sentiment: CME’s CEO Terry Duffy publicly warned that U.S. government intervention in oil futures markets would be highly damaging; exchanges including CME have voiced opposition to potential Treasury action. This raises policy/regulatory risk for energy derivatives but also underscores the exchange’s central role in market integrity — a factor that can support trading volumes in energy products if volatility rises. US intervention in oil futures would be ‘biblical disaster’, CME warns CME Group CEO warns against US intervention in oil futures markets US intervention in oil futures market could be disastrous: CME Group
• Neutral Sentiment: Short-interest reporting in recent feeds shows zero or nonsensical values and appears to be a data anomaly rather than a real bearish signal; treat those short-interest items with caution. (Market impact minimal until corrected.)
• Negative Sentiment: Insider selling: Ken Vroman (Chief Transformation Officer) sold about 5,160 shares (~$1.59M) and SEC filings show multiple recent insider sales across senior staff. While insider sales can be routine, the cadence and size may raise governance/owner-sentiment questions for some investors. CME Group’s Vroman sells $1.59 million in stock Insider Sale: Chief Transformation Officer of $CME Sells 5,160 Shares

Insider Activity at CME Group

In related news, Director Martin J. Gepsman sold 300 shares of the business's stock in a transaction on Friday, February 20th. The stock was sold at an average price of $305.90, for a total transaction of $91,770.00. Following the sale, the director owned 24,999 shares in the company, valued at $7,647,194.10. The trade was a 1.19% decrease in their position. The sale was disclosed in a legal filing with the SEC, which is available at this hyperlink. Also, Director William R. Shepard bought 251 shares of the stock in a transaction on Tuesday, December 30th. The stock was purchased at an average cost of $278.37 per share, with a total value of $69,870.87. Following the acquisition, the director owned 258,710 shares in the company, valued at approximately $72,017,102.70. This represents a 0.10% increase in their ownership of the stock. Additional details regarding this purchase are available in the official SEC disclosure. Insiders have sold a total of 5,248 shares of company stock valued at $1,616,700 over the last three months. 0.30% of the stock is currently owned by corporate insiders.

CME Group Company Profile

CME Group Inc is a global markets company that operates some of the world's largest and most liquid derivatives exchanges, including the Chicago Mercantile Exchange (CME), the Chicago Board of Trade (CBOT), the New York Mercantile Exchange (NYMEX) and COMEX. The firm offers futures and options contracts across a broad range of asset classes — including interest rates, equity indexes, foreign exchange, energy, agricultural commodities and metals — and serves a diverse client base of institutional investors, commercial hedgers, brokers and retail participants.

The company's core services include electronic trading on the CME Globex platform, central clearing through CME Clearing, and distribution of market data, indexes and analytics.

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