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What this page is: Delvantic's full research page for CME Group Inc. (CME) — AI-driven forensic equity research: mechanical valuation models (DCF, EPV, anchored-PE, scenario) plus three independent AI lenses (Quality / Value / Sentiment). Everything below is rendered server-side; you are not missing content that requires JavaScript. All scores are predictions and research opinions, not financial advice.
Our current read (analysis of 2026-10-08): Designation Watch · Gem Score -5 (−100…+100 Quality+Value blend) · Quality 90 · Value -69 · Sentiment 5 (timing only, not weighted) · Composite fair value $147.30 vs $285.65 at analysis
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profile-header/price-overview— company profile, live quote, market capextended-analysis— the core: three AI lens reads with findings, scores, and the analyst memofuture-predictions— our forward price-band predictionsmarket-narrative/ai-findings/gpt-critique— narrative context, cross-model findings, and an adversarial critique of our own analysis (near the end of the document)- Members-only sections (render as login gates for anonymous readers):
price-history,income-trend,key-metrics,financials(statement tables),insider-trading. The analysis above is public; the raw data tables require a free account.
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any ticker resolves at delvantic.com/stock/TICKER ·
raw inputs are public-company filings and market data (via licensed data feeds);
every model, score, lens read, and prediction on this page is Delvantic's own analysis.
CME Group Inc.
CME NASDAQCME Group Inc. is a global financial market infrastructure company that operates one of the world’s leading derivatives marketplaces. The company provides platforms for trading futures, options, cash, and over-the-counter products, enabling participants to manage risk across major asset classes such as interest rates, equity indexes, foreign exchange, energy, agricultural commodities, and metals. CME Group also offers central counterparty clearing services, helping reduce counterparty and systemic risk in the financial system. In addition, it delivers market data, analytics, and information services that support price discovery and trading decisions for institutions, corporations, and professional traders worldwide. Through its designated contract markets and electronic trading systems, CME Group plays a central role in global price formation and risk transfer, supporting liquidity and transparency in both developed and emerging markets. Headquartered in Chicago, Illinois, it serves a broad range of financial, commercial, and industrial clients around the world.
Price Overview
Price History (1 Year)
Revenue & Net Income Trend
| Period | Revenue | Net Income | Net Margin | YoY/QoQ |
|---|
Key Metrics
EPS (Diluted): 11.16
Total Equity: $28.73B
Shares: 364,892,473
Total Debt: $0.00
Cash: $4.42B
EBITDA: $98.30M
Total Debt: $0.00
Cash: $4.42B
Revenue: $6.52B
Revenue: $6.52B
Revenue: $6.52B
Total Equity: $28.73B
Tax Rate: 23.6%
Equity: $28.73B
Total Debt: $0.00
Cash: $4.42B
Current Liabilities: $160.30B
Long-Term Debt: $0.00
Total Debt: $0.00
Total Equity: $28.73B
Shares: 364,892,473
Shares: 364,892,473
CapEx: -$83.50M
Shares: 364,892,473
Stock Price: $263.66
Net Income: $4.07B
Industry Benchmarks
Income Statement (Annual)
Last updated: Aug 7, 2026 4:28am (61d ago)| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Revenue | $4.7B | $5.0B | $5.6B | $6.1B | $6.5B |
| Cost of Revenue | $837.0M | $753.1M | $828.6M | $850.3M | $907.0M |
| Gross Profit | $3.9B | $4.3B | $4.8B | $5.3B | $5.6B |
| Operating Expenses | $1.2B | $1.3B | $1.3B | $1.3B | $1.4B |
| Operating Income | $2.6B | $3.0B | $3.4B | $3.9B | $4.2B |
| Net Income | $2.6B | $2.7B | $3.2B | $3.5B | $4.1B |
| EBITDA | $3.6B | $1.8B | -$609.7M | $960.0M | $98.3M |
| EPS | $7.30 | $7.41 | $8.87 | $9.69 | $11.18 |
| EPS (Diluted) | $7.29 | $7.40 | $8.86 | $9.67 | $11.16 |
Balance Sheet (Annual)
Last updated: Aug 7, 2026 12:05am (62d ago)| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Cash & Equivalents | $2.8B | $2.7B | $2.9B | $2.9B | $4.4B |
| Total Current Assets | $161.8B | $139.1B | $94.9B | $103.0B | $165.4B |
| Total Assets | $196.8B | $174.2B | $129.7B | $137.4B | $198.4B |
| Current Liabilities | $160.4B | $137.7B | $93.4B | $102.3B | $160.3B |
| Long-Term Debt | — | — | — | — | — |
| Total Liabilities | $169.4B | $147.3B | $103.0B | $111.0B | $169.7B |
| Total Equity | $27.4B | $26.9B | $26.7B | $26.5B | $28.7B |
| Retained Earnings | $5.2B | $4.7B | $4.5B | $4.2B | $6.4B |
Cash Flow (Annual)
Last updated: Aug 7, 2026 4:28am (61d ago)| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Operating Cash Flow | $2.4B | $3.1B | $3.5B | $3.7B | $4.3B |
| Capital Expenditure | -$127.2M | -$89.7M | -$76.4M | -$94.0M | -$83.5M |
| Free Cash Flow | $2.3B | $3.0B | $3.4B | $3.6B | $4.2B |
| Acquisitions (net) | — | — | — | — | — |
| Net Debt Issued / (Repaid) | — | — | — | — | — |
| Dividends Paid | -$2.2B | -$2.6B | -$3.2B | -$3.6B | -$3.9B |
| Stock Buybacks | — | — | — | — | — |
| Net Change in Cash | $72.4B | -$22.8B | -$44.9B | $8.7B | $62.3B |
Growth Trends (YoY %)
Last updated: Aug 7, 2026 4:28am (61d ago)| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Revenue Growth | +7.0% | +11.1% | +9.9% | +6.4% |
| Gross Profit Growth | +10.7% | +11.3% | +11.1% | +6.3% |
| Operating Income Growth | +14.0% | +13.9% | +14.4% | +7.6% |
| Net Income Growth | +2.0% | +19.9% | +9.3% | +15.5% |
| EBITDA Growth | -49.8% | -133.6% | +257.5% | -89.8% |
Dividend History (Last 20)
Last updated: Aug 6, 2026 7:38am (62d ago)| Date | Dividend | Declaration | Record | Payment |
|---|---|---|---|---|
| 2026-06-09 | $1.30 | — | — | — |
| 2026-03-10 | $7.45 | — | — | — |
| 2025-12-12 | $1.25 | — | — | — |
| 2025-09-09 | $1.25 | — | — | — |
| 2025-06-09 | $1.25 | — | — | — |
| 2025-03-07 | $1.25 | — | — | — |
| 2024-12-27 | $5.80 | — | — | — |
| 2024-12-09 | $1.15 | — | — | — |
| 2024-09-09 | $1.15 | — | — | — |
| 2024-06-07 | $1.15 | — | — | — |
| 2024-03-07 | $1.15 | — | — | — |
| 2023-12-27 | $5.25 | — | — | — |
| 2023-12-07 | $1.10 | — | — | — |
| 2023-09-07 | $1.10 | — | — | — |
| 2023-06-08 | $1.10 | — | — | — |
| 2023-03-09 | $1.10 | — | — | — |
| 2022-12-27 | $4.50 | — | — | — |
| 2022-12-08 | $1.00 | — | — | — |
| 2022-09-08 | $1.00 | — | — | — |
| 2022-06-09 | $1.00 | — | — | — |
Deep Analysis
Risk : Reward — upside vs downside from this company's own quarters
Computed 2026-10-03 02:02A +1σ run of quarters pays -80%; a −1σ run costs 88%. Ratio -0.9:1 (μ 7.5%, σ 6.7% , 16 pairs).
Older method (repeat-worst-quarter): -0.9 : 1
| Case | Growth | Margin | Fair value | vs price ($285.65) |
|---|---|---|---|---|
| Bull — recovery | +6% | 17.7% | $46.78 | -84% |
| Base — stabilizes | +4% | 15.4% | $38.75 | -86% |
| Bear — keeps slipping | +2% | 13.1% | $31.51 | -89% |
| Stress — last quarter repeats | -3% | 15.1% | $30.38 | -89% |
| Upside — a +1σ run of quarters (v2) | +14% | 16.1% | $56.41 | -80% |
| Stress — a −1σ run of quarters (v2) | +1% | 15.1% | $34.42 | -88% |
Narrative Economics
market-narrative step).
Growth Outlook
Analyzed 2026-08-31 23:24The question every valuation on this page silently assumes: is this company likely to grow? Judged forward — the business, its category, the world — against what's already printed.
Claude Reading
Looking at the raw numbers first: CME has grown revenue from $4.69B (2021) to $6.52B (2025), a 8.6% CAGR, with net income compounding faster from $2.64B to $4.07B (11.4% CAGR) thanks to operating leverage — op margin expanded from 56.5% to 64.9%. Q2 2026 revenue of $1.71B is up only 1.2% YoY vs. $1.69B in Q2 2025, and Q1 2026's $1.88B vs. Q1 2025's $1.64B is +14.6% — this is not "accelerating" so much as lumpy, volatility-driven revenue. Net margins near 61% and FCF conversion of $4.19B on $6.52B rev (64%) confirm this is a toll-booth business. At $285.50 and $102.66B market cap, you're paying 25.2x TTM earnings and ~24.5x FCF for a business growing high single digits with a 3.96% dividend yielding 96.6% of earnings — essentially a bond-proxy with modest growth optionality.
The synthesis verdict of $192.76 fair value (implying 33% downside) strikes me as too aggressive for a business with this quality of cash flows and moat. A reverse DCF at $285.50: assuming 8% FCF growth for 10 years fading to 3% terminal at 9% discount gets you roughly $260-280 intrinsic — the stock is 5-10% rich, not 33% rich. The synthesis is likely anchoring on a mean-reversion assumption for trading volumes that ignores structural growth in derivatives (rates, energy, crypto) and CME's demonstrated pricing power. That said, the market-forces "cyclical peak" concern has teeth: 2022-2025 revenue was juiced by rate volatility, and if the Fed settles into a stable regime, interest rate futures volumes — CME's largest complex — could soften 10-15%. The narrative model's "26% premium for optionality" framing is the honest read.
The contrarian bull case the models underweight: CME's ROE of 14.2% understates return on tangible capital dramatically because $28.7B equity is inflated by goodwill from the CBOT/NYMEX deals; return on tangible operating capital is likely 40%+. Debt/equity of 0.12 with $4.42B cash means the balance sheet can absorb a special dividend or accretive M&A. The 96.6% payout ratio isn't a red flag here — it's the business model (variable dividend plus base). Insider activity shows small P-purchases (325 sh, 14 sh) alongside awards; not a meaningful signal either way. The contrarian bear case: at 15.6x EV/revenue and 25x earnings, CME trades at a premium to ICE (~22x) despite ICE having faster growth from mortgage tech and fixed-income data. If you believe FTX-style tokenized derivatives or 24/7 crypto perpetuals structurally erode CME's crypto futures relevance (still small, but symbolic), the multiple compresses.
I partially dissent from the synthesis. The direction is right — CME is modestly overvalued — but $192.76 is a valuation model artifact, probably from applying growth-stock DCF conventions to a mature earner. My fair value anchor is $255-270, implying 5-10% downside, not 33%. The 3.96% dividend cushions the wait. This is a "hold if you own it, don't chase it here" stock; a starter position makes sense below $255, and it becomes genuinely attractive below $230 where you'd be getting a 4.9%+ yield on a fortress franchise. The Q2 2026 deceleration to +1.2% YoY is the tell — if Q3/Q4 confirm volume normalization, multiple compression to 22x ($245) is the likely path. If rate vol resurges, the stock defends $285. Asymmetry is mildly negative but not the 21-33% downside the composite claims.
GPT Reading
CME is exactly the kind of business the market loves to overpay for: a near-irreplaceable financial utility with absurd margins, minimal capital intensity, and cash generation that looks bond-like until volatility spikes and reminds everyone it still has cyclical torque. The raw numbers are excellent. Revenue has risen from $4.69B in 2021 to $6.52B in 2025, an 8% CAGR, while net income climbed from $2.64B to $4.07B, faster than sales, pushing net margin to an extraordinary 62.5% in 2025. Free cash flow of $4.19B on $6.52B of revenue means roughly 64% FCF margin, and capex was only $83.5M. The balance sheet is cleaner than most “defensives”: $4.42B cash against $3.42B debt. Operationally, the story is hard to criticize. Even the latest quarter supports resilience: Q2 2026 revenue was $1.71B versus $1.69B a year earlier, and net income was $1.04B versus $1.03B, so margins actually ticked up from 60.6% to 61.1%. This is not a deteriorating franchise.
But the stock is priced like this level of quality deserves no cyclical discount at all. At $285.5 and a $102.7B market cap, investors are paying about 15.7x revenue, 25.6x earnings, and roughly 24.5x trailing FCF. For a software platform that can grow 15-20%, maybe; for an exchange operator growing high single digits with volume exposure to macro conditions, that is rich. The key issue is not whether CME is good—it plainly is—but whether current earnings are closer to normalized or elevated. 2024 and 2025 benefited from a fertile derivatives backdrop: rates uncertainty, energy volatility, and broad macro churn. Yet 2026 quarterly revenue has been lumpy—$1.88B in Q1, then $1.71B in Q2, after $1.65B in Q4 2025 and $1.54B in Q3 2025—suggesting this is still a volumes-driven business, not a smooth annuity. If I take 2025 net income of $4.07B as a healthy but favorable earnings base and apply a more appropriate 20-22x multiple for a dominant, slow-to-mid growth market infrastructure asset, I get equity value of about $81B-$90B, or roughly $225-$250 per share. That is still a premium valuation; it just isn’t today’s premium-on-premium.
The strongest counterargument is that I may be underestimating how structurally better CME has become. Revenue has not just grown; margins have widened from 56.3% net margin in 2021 to 62.5% in 2025, showing real operating leverage and pricing power. Recent earnings momentum is better than the “mature utility” caricature: the provided growth stats show 6.4% recent revenue growth and 15.5% recent earnings growth, and Q2 2026 net income still increased despite already elite profitability. The 3.96% dividend yield also matters more here than for a typical growth stock; if the dividend is sustainable, a 25-26x earnings multiple on a fortress-like monopoly is not obviously insane, especially when debt is low and cash flow quality is exceptional. In that framing, CME deserves to trade like a regulated toll road with embedded call options on volatility, not like a plain cyclical financial. A bull would also say that the market is rationally paying up for scarcity: there are very few public assets with CME’s combination of oligopolistic moat, regulatory barriers, 86% gross margin, and low capex needs.
I still weigh it differently because the payout ratio at 96.6% tells you a lot: this is already a harvest business, not a reinvestment machine. Harvest businesses can merit premium multiples, but not endless ones. The market narrative seems to be capitalizing both safety and upside simultaneously—treating CME as recession-resistant infrastructure while also assuming elevated trading activity remains the norm. That is where I disagree. If revenue growth settles back toward 4-6% and net margin stays around 60-62%, this is an excellent company that compounds steadily, but one that should trade in the low-20s earnings multiple, not the mid-20s with little room for error. What would change my mind is simple: if the next few quarters show that the Q1 2026 strength was not episodic and CME can sustain a run rate closer to $7.0B-$7.3B annual revenue while preserving 60%+ net margins, then the market’s willingness to pay $285 may prove justified. Conversely, if quarterly revenue falls back toward the $1.55B-$1.65B zone without a margin offset, the multiple should compress quickly.
Grok Reading
CME’s numbers describe a cash machine with almost no capital intensity: $6.52B of 2025 revenue produced $4.23B of operating income and $4.19B of free cash flow after only $83.5M of capex, leaving net margins above 62% and a balance sheet that is net cash ($4.42B cash versus $3.42B debt). Five-year revenue CAGR of 8.1% and earnings CAGR of 12.4% show the operating leverage still works; the most recent full year grew revenue 6.4% and the June 2026 quarter still printed $1.71B with a 61% net margin. At $285.5 the stock trades at 25.6× trailing earnings and roughly 16× sales while returning nearly all free cash via a 4.0% dividend (payout 97%). That combination—oligopoly clearing economics, mid-single-digit top-line growth, and a near-100% cash return—explains why the market awards a premium multiple, yet it also means the equity is priced as a low-duration bond with a modest growth kicker rather than as a compounder that reinvests.
What stands out is the gap between the durability of the franchise and the growth already embedded in the price. Quarterly revenue has been choppy: the March 2026 print of $1.88B was strong, but the subsequent $1.71B quarter was essentially flat year-over-year versus the $1.69B of June 2025. That pattern is consistent with a business still riding residual rate-volatility and macro uncertainty rather than a secular volume super-cycle. ROE of 14% and ROIC of 12% on $28.7B of equity are solid but not spectacular once you notice how little incremental capital the model requires; the excess cash is simply paid out. The valuation synthesis that lands fair value in the low-to-mid $200s therefore feels directionally correct—investors are paying roughly 20–25% above a conservative DCF for the option that volumes and data licensing keep compounding at the upper end of the historical range.
The strongest counter-argument is that CME is not a normal mature earner and that 25–26× earnings is the wrong yardstick for irreplaceable market infrastructure. Gross margins of 86%, operating margins of 65%, and a debt-to-equity ratio of 0.12 give the company fortress characteristics that rarely trade at mid-teens multiples; any mean-reversion in volatility is partially offset by secular adoption of listed derivatives, energy and crypto contracts, and higher-margin market-data products. Insider activity shows net buying (small open-market purchases alongside routine awards), free-cash-flow quality is pristine, and the narrative layer correctly flags a durable platform-monopoly story rather than a fleeting growth fad. A patient holder collecting 4% while waiting for the next volatility regime can argue that the “overvaluation” is simply the price of quality and that the $226 signal-adjusted fair value undervalues the clearing moat and pricing power. I weigh that case seriously, yet still discount it: the same data show revenue growth already decelerating into the mid-single digits and a payout ratio that leaves almost no internal fuel for acceleration, so the premium requires continued multiple expansion or sustained high-single-digit earnings growth that the recent quarterly run-rate does not guarantee.
I would reverse the call if trailing twelve-month revenue re-accelerates above 9–10% for two consecutive quarters, if operating margin expands another 200 bp on mix shift toward data and clearing fees, or if management signals a material capital-return increase or bolt-on acquisition that deploys the net-cash position into higher-growth adjacencies without diluting the moat. Conversely, two quarters of sub-4% revenue growth or any regulatory hit to clearing economics would confirm the multiple compression already implied by the models.
Qwen Reading local experiment · off-panel
The number that decides this case is the Q2 2026 revenue print: $1.71B, up just 1.2% from $1.69B a year earlier, after Q1 2026 surged 14.6% to $1.88B. That single quarter tells you the "High Revenue Confidence (accelerating)" tag in the secondary signals is wrong — the YoY sequence across the last four comparable quarters is −2.5%, +7.8%, +14.6%, +1.2%, which is volatile, not accelerating. The TTM revenue of roughly $6.78B does sit above 2025's $6.52B, so the run-rate hasn't broken, but the marginal growth rate has clearly cooled and the prior models' "accelerating" characterization is not supported by the tape.
Everything else in the raw data is clean and internally consistent. The five-year annual series shows a textbook toll-booth: revenue from $4.69B (2021) to $6.52B (2025), an 8.5% CAGR, with net margin holding in the 54–62% band and operating margin at 64–65%. FCF of $4.19B on $6.52B revenue is a 64% conversion rate, and capex of $83.5M is 1.3% of revenue — capital-light by design, not under-invested. The $0 total debt line is plausible for a clearinghouse carrying $4.42B cash and $28.73B equity; this is not the missing-line artifact you would see at a leveraged telecom or airline. The EV/EBITDA of 922x is a data error (EBITDA is being computed as near-zero in the source) and I am setting it aside. The insider block shows eight A-Awards and two P-Purchases of 14 and 325 shares — at $263.66 that is under $90K of open-market buying, which is compensation mechanics, not conviction. The "Net Insider Buying" tag is technically true and informationally worthless.
The EV bridge: $94.81B market cap minus $4.42B cash plus $0 debt gives an EV of roughly $90.4B. Against 2025 operating income of $4.23B, that is 21.4x EV/OpInc; against FCF of $4.19B, 21.6x EV/FCF. The P/E of 23.3x on $4.07B of 2025 net income is the headline multiple. The exchange and clearinghouse peer group trades in the 20–25x earnings range, so CME is mid-pack, not stretched. The 4.27% dividend yield on a 96.6% payout ratio means the stock is effectively a 4.3% yield vehicle with a growth kicker; the payout is high but appropriate for a business with no meaningful capex or reinvestment needs. The prior models' composite fair value of $213.67 implies roughly 19x 2025 earnings, a discount the data does not support given the 12.4% four-year earnings CAGR and zero leverage; the signal-adjusted $259.78 is within 1.5% of the current price, which is a "fairly valued" call dressed up as "slight upside." I agree with the overall direction of the priors but find the composite too low and the signal adjustment doing too much of the work.
The strongest case against a "fairly valued" or "slightly undervalued" read is the Q2 2026 deceleration combined with the 96.6% payout ratio. A smart bear would say: revenue growth has dropped to 1.2% YoY, the 12.4% earnings CAGR is a four-year average that flatters the current trajectory, and with 96.6% of earnings paid out as dividends there is no internal capital to fund new product launches or bolt-on M&A. If trading volumes normalize as volatility cools — the "Macro Headwinds" tag points in that direction — revenue could flatline, and a 23x P/E on flat earnings is simply a 23x P/E with no growth to justify the multiple. The Q1 2026 spike to $1.88B may have been a one-time volume event rather than a new base. I weigh this concern seriously, but the TTM revenue is still above last year's total, the 86% gross margin is structural rather than cyclical and does not compress with volume, and the zero-debt balance sheet means there is no solvency risk even in a volume trough. The bear case is a growth-deceleration story, not a solvency or margin story, and that distinction matters for the multiple.
What would change my mind: a second consecutive quarter of sub-3% YoY revenue growth would confirm the deceleration is structural rather than a one-quarter blip, and I would move to overvalued at 23x with no growth to anchor the multiple. Conversely, if the next reported quarter shows revenue back above 8% YoY growth — consistent with the 2024–2025 pattern — the 23x multiple looks cheap for a 10%+ earnings grower carrying a 4.3% yield and zero debt, and I would push toward undervalued. The crypto-derivatives volume line, which the briefing does not break out separately, is the swing factor: if it contributed meaningfully to the Q1 spike, the base case is more fragile than the annual CAGR suggests, and the 1.2% Q2 print is the more honest read.
Big-3 Panel — where each AI stands
Advanced Analysis Forensic deep-dive · separate lenses
The business is a rare-quality compounder. Revenue rose from 4.69B in 2021 to 6.52B in 2025 (roughly 8.6% CAGR), while operating margin expanded from 56.4% to 64.9% and net income grew from 2.64B to 4.07B (54% cumulative). Free cash flow tracks earnings tightly (4.19B FCF vs 4.07B NI in 2025; OCF/NI 1.04x), signaling clean earnings quality. Diluted share count is essentially frozen at ~365M (0.2% CAGR) with SBC only 1.5% of revenue - per-share value is protected. The Altman Z of 0.54 flagged as 'distress' is a false positive: the model penalizes CME's clearinghouse balance sheet (huge performance-bond assets/liabilities on both sides), not real solvency risk. With 4.54B liquid cash, 1.12B net cash, and 4.19B annual FCF, this is a self-funding, capital-light franchise. Insider tape is dominated by director stock awards; the only directional signals are small P-purchases by Shepard, which are neutral-to-slightly positive. Management/insider behavior shows no red flags. The dominant qualitative fact - CME's near-monopoly in US interest-rate, equity-index, and energy futures with regulatory moats and network effects - is consistent with the observed margin structure and ROIC.
Verify before trusting this (5)
- Confirm the Altman Z distress reading is driven by clearing-member performance-bond gross-up, not operating leverage
- Segment mix and volume trends (interest-rate vs equity vs energy) to gauge durability of margin expansion
- Capital-return policy detail (variable dividend + buyback) and any hidden dilution in equity-comp plans
- Competitive threats from ICE, Cboe, and any nascent crypto/tokenized derivatives venues eroding open-interest share
- Regulatory/clearinghouse capital requirements and any pending rule changes affecting margin models
The composite fair value of $192.76 and signal-adjusted FV of $226.01 both sit well below the $285.65 price, implying roughly -21% downside on the blended read. The DCF ($197.83) and EPV floor ($105.34) corroborate that the market is paying up for durability, while only the anchored-PE method ($270.05) gets close to today's price - and that method effectively capitalizes the current multiple, so it is the least independent check. Even generously weighting the anchored-PE, deserved value lands in the $220-260 range against a $285 tape. Quality is genuine (86% gross, 65% operating margins, fortress cash conversion), which justifies a premium multiple - but a premium is already fully embedded. To justify $285 you need sustained volume growth, benign competition from crypto/DeFi venues, and no regulatory hit to clearing/margin - a coherent story, but one that leaves essentially no margin of safety. Earnings quality is only 'adequate/mixed,' which argues for a haircut, not a bonus, on deserved value. This is the classic 'great business, full price' setup: I would not short it, but I would not pay here. Fair verdict is Rich, not Overvalued, because the quality is real and the gap is ~20% rather than 40%+.
Verify before trusting this (4)
- Forward volume/RPC guidance and whether rates-vol tailwind is being extrapolated
- Any change in clearing/margin regulation that would compress capital-efficient trading
- Special dividend cadence vs organic reinvestment - affects cash return math in DCF
- Segment mix shift (interest rate vs equity vs energy) and pricing power by product
CME sits in a strange sentiment pocket. The tape is mildly risk-on (regime +26, VIX 14.9) but with a 0.27 beta and a defensive exchange profile, none of that lift reaches this name - risk-on tapes typically rotate money OUT of derivatives-plumbing utilities and INTO higher-beta growth. Offsetting that, the narrative is 'platform-monopoly' with durable intensity, which keeps a bid under the stock even when it is not the tape's darling. Net: no strong push either way. News flow is neutral-to-mildly-positive: product-suite expansion (equity factor futures, wind power futures) reinforces the 'irreplaceable plumbing' story without being a catalyst, and a Yahoo piece about Wall Street building AI-chip futures markets subtly extends CME's optionality narrative. The competitor read-through from ICE trading near highs suggests exchange-sector sentiment is constructive. Nothing here is breaking the story; nothing is igniting it either. Analyst tone/target revisions were not provided, but the durable-moderate narrative with low cult coefficient implies a quiet, institutionally-owned name where sentiment moves in inches, not feet - a balanced pressure profile that will not overwhelm fundamentals in either direction.
Verify before trusting this (4)
- Whether VIX pushes above 20 or rates volatility spikes - would activate the 'volatility beneficiary' narrative and turn tailwinds decisive
- Any regulatory headlines on clearing/margin rules that could wake the dormant bear case
- Rotation signals - if the tape turns risk-off, low-beta defensives like CME get a real bid
- Analyst target revisions post product launches, particularly on AI-chip futures optionality
The world is currently set up well for CME's core function. Elevated absolute rates, a barely positive curve, unresolved policy direction and geopolitically driven commodity and FX risk all force institutions to hedge through listed, cleared instruments — CME is that infrastructure. The 'macro headwinds' framing that hurts most companies is a mild tailwind here: uncertainty is CME's raw material. The genuine structural questions are (1) whether the growth of the financial-data category, which is being driven by analytics, indices and workflow software, keeps accruing to CME's transaction-fee model, and (2) whether cross-margined clearing at rival venues can finally break the open-interest lock in rates. Neither threat is close to decisive today, but both explain why CME grows at high-single digits while its category grows low-double digits. This is a compounder, not an inflection story.
When we made this prediction on Sep 1, 2026, CME was $284.79. We expect it to be $270.00 by Mar 2027, and we consider it great value under $225.00. This is an early model (v0.6.0) — the direction is more reliable than the exact price. Made Sep 1, 2026.
Blue is our prediction, starting the day we made it. Grey is a slower route to the same place — the same destination, taking longer. Black is the actual price, so you can see how we are doing.
Post-Report Due Diligence NOTES
Evidence for a closer look, not a verdict — no score or designation on this page has been changed by it. Items marked material are ones where a conclusion above moves to the other side of the price.