Company Reports

Cboe and S&P Global announced they signed a new agreement granting Cboe an exclusive license to offer S&P 500 index options through 2051.

Under new CEO Craig Donohue, Cboe has stated its intent to optimize its capital allocation and spending decisions. We like this shift for the company, as Cboe’s unfocussed investment strategy led to excessive operating expense growth during 2020-24, offsetting some of the benefit of the firm's impressive option volume and data revenue growth. Cboe has made rapid progress on its new strategy, exiting cash cryptocurrency trading in 2024, closing its Japanese equity exchange in 2025, and moving to sell its Canadian and Australian exchange businesses in 2026. With a stronger focus on cost efficiency, we expect Cboe's operating margin to remain in the mid 60s, up from the mid 50s the firm typically delivered prior to 2025.

Cboe reported very strong second-quarter earnings as the firm benefited from strong trading volume, accelerated data revenue growth, and effective cost management. Net revenue increased 25% from last year to $731 million, while diluted earnings per share jumped 50% to $3.35.

Cboe is benefiting from surging trading volume, particularly in its proprietary index options. While we expect normalization, Cboe is a major beneficiary of volatile trading conditions, especially as it brings its operating costs under control.

Under new CEO Craig Donohue, Cboe has stated its intent to optimize its capital allocation and spending decisions. We like this shift for the company, as Cboe’s unfocussed investment strategy led to excessive operating expense growth during 2020-24, offsetting some of the benefit of the firm's impressive option volume and data revenue growth. Cboe has made rapid progress on its new strategy, exiting cash cryptocurrency trading in 2024, closing its Japanese equity exchange in 2025, and moving to sell its Canadian and Australian exchange businesses in 2026. With a stronger focus on cost efficiency, we expect Cboe's operating margin to remain in the low to mid 60s, up from the mid 50s the firm typically delivered prior to 2025.

Cboe reported impressive first quarter earnings as volatile trading conditions drove trading volumes to new highs. Net revenue increased 29% from last year to $729 million, while diluted earnings per share rose 54% to $3.66.

Cboe delivered excellent results in 2025, as intense market activity and a more disciplined approach to operating costs drove a 25% increase in adjusted diluted earnings per share.

Under new CEO Craig Donohue, Cboe has stated its intent to optimize its capital allocation and spending decisions. We like this shift for the company, as Cboe’s unfocussed investment strategy led to excessive operating expense growth during 2020-24, offsetting some of the benefit of the firm's impressive option volume and data revenue growth. Cboe has already made progress on its new strategy, closing its Japanese equity exchange in 2025 and exiting cash cryptocurrency trading in 2024. With a stronger focus on cost efficiency, we expect Cboe's operating margin to remain in the low 60s, up from the mid 50s the firm typically delivered prior to 2025.

Cboe reported exceptional fourth-quarter results to end an already strong 2025 thanks to a dramatic increase in options volume. Net revenue increased 28% to $671 million while adjusted diluted earnings per share rose 46% to $3.06.

Cboe reported strong third-quarter results with strong performance in US options and at its European exchanges. Net revenue rose 14% from last year to $605.5 million. Meanwhile, adjusted diluted earnings per share rose 20% to $2.67.

We are initiating coverage of Cboe, the largest option exchange in the US. Through an exclusive licensing agreement, Cboe is the sole provider of S&P 500 and VIX index options, which provide more than half its revenue. The firm also has equity exchanges in the US, Canada, Europe, and Australia.

Under new CEO Craig Donohue, Cboe has stated its intent to optimize its capital allocation and spending decisions. We like this shift for the company, as Cboe’s unfocussed investment strategy led to excessive operating expense growth during 2020-24, offsetting some of the benefit of the firm's impressive option volume and data revenue growth. There are already tangible signs as a result of the change in strategy, with Cboe closing its Japanese equity exchange in 2025. This followed on the firm exiting cash cryptocurrency trading in 2024. With a strong focus on cost efficiency, we see room for margin expansion as the firm benefits from a mostly fixed cost base and strong revenue growth.

We are dropping coverage of CBOE Holdings. We provide broad coverage of more than 1,400 companies across more than 140 industries and adjust our coverage as necessary based on client demand and investor interest.

In its first day of trading in 1973, CBOE saw just 911 contracts trade; now millions change hands daily. CBOE's growth mirrored the evolution of the investing public's interest in options--what was once an outpost of the securities business is now a powerful magnet for trading appetite. Although the trading environment remains uncertain, we think that interest in trading options, especially lucrative index products, will continue to propel CBOE's earnings growth. We also expect continued progress at the company's fast-growing futures exchange, fed by the significant appeal of CBOE's volatility methodology.

CBOE reported solid third-quarter earnings fueled by higher volume and fees in its core index-options and futures products. Despite the lift in trading activity seen in October, we do not envision a very large change to our $45 fair value estimate.

In its first day of trading in 1973, CBOE saw just 911 contracts trade; now millions change hands daily. CBOE's growth mirrored the evolution of the investing public's interest in options--what was once an outpost of the securities business is now a powerful magnet for trading appetite. Although the trading environment remains uncertain, we think that interest in trading options, especially lucrative index products, will continue to propel CBOE's earnings growth. We also expect continued progress at the company's fast-growing futures exchange, fed by the significant appeal of CBOE's volatility methodology.

Profits at CBOE Holdings were held back by lower trading volume. We are unlikely to make large changes to our fair value estimate on this narrow-moat name. For the second quarter, CBOE earned $42.6 million, or $0.50 per share, compared with $45.5 million, or $0.52 per share, a year earlier. On an adjusted basis, the year-earlier EPS came to $0.54.

In its first day of trading in 1973, CBOE saw just 911 contracts trade; now millions change hands daily. CBOE's growth mirrored the evolution of the investing public's interest in options--what was once an outpost of the securities business is now a huge magnet for trading appetite. Although the trading environment remains uncertain, we think that interest in trading options, especially lucrative index products, will continue to propel CBOE's earnings growth. We also expect continued growth in the company's newer futures exchange, powered by the continued appeal of CBOE's volatility methodology.

We believe that the looming updates to Europe's original Markets in Financial Instruments Directive (MiFID II) present a risk to how we view moats for exchanges that operate in Europe.