Equity Market and Foreign-Exchange Volatility Support Solid Q4 for CME, Closing Out a Strong 2022

Wide-moat-rated CME Group reported solid fourth-quarter results that were largely in line with our expectations, driven by strength in the company's equity index and foreign-exchange futures. Net revenue increased 5.3% year over year but fell 1.6% sequentially to $1.21 billion. Diluted earnings per share rose 2.3% from the prior-year period to $1.75. As we incorporate these results, we do not plan to materially alter our $215 fair value estimate. We view the shares as modestly undervalued at current prices.