Morningstar

Cboe Global Markets Inc CBOE

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Stock BATS Rating as of
$282.15 +7.87 (2.87%)
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As of Cboe BZX Real-Time Price Open

Company Report

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Cboe Global Markets: Increasing Our Fair Value Estimate Following Earnings

Michael Miller

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.

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Price vs Fair Value

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CBOE is trading at a LOCK|wlW>Cp premium.
Price
$274.40
Fair Value
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Uncertainty
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1-Star Price
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5-Star Price
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Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

If US option trading volume continues to grow at an accelerated rate, Cboe would be the primary beneficiary as the largest options exchange in the US.

Bears

Cboe is reliant on an exclusive license agreement for its S&P 500 index options that it may not be able to renew before expiration.

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News

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Trading Information

Previous Close Price
$274.40
Day Range
$275.00–290.80
52-Week Range
$227.19–370.81
Bid/Ask
$281.87 / $282.37
Shares Outstanding
104.65M
Market Cap
$29.63B
Volume/Avg
626,290 / 1M

Key Statistics

Price/Earnings (Normalized)
23.08
Price/Sales
6.02
Dividend Yield (Trailing)
1.05%
Dividend Yield (Forward)
1.05%
Total Yield
1.32%

Company Profile

Founded in 1973, Cboe controls the largest option exchange in the US, which provides around 60% of the firm's revenue. The company is best known for its proprietary S&P 500 and VIX index options, which it offers through an exclusive contract with S&P Global. The firm moved into US and European equities through the $3.4 billion acquisition of BATS in 2017. Cboe has continued to look to expand internationally, using acquisitions to build a presence in both Canada and Australia.
Sector
Financial Services
Industry
Financial Data & Stock Exchanges
Stock Style Box
Mid Growth
Total Number of Employees
1,661
Website
https://www.cboe.com

Competitors

Valuation

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Metric
CBOE
ICE
CME
Price/Earnings (Normalized)
 23.0818.2820.17
Price/Book Value
 5.352.663.23
Price/Sales
 6.026.0812.68
Price/Cash Flow
 20.3714.1619.57
Price/Earnings
CBOE
ICE
CME

Financial Strength

Metric
CBOE
ICE
CME
Quick Ratio
 0.600.060.02
Current Ratio
 1.391.011.02
Interest Coverage
 32.697.3332.93
Quick Ratio
CBOE
ICE
CME

Profitability

Metric
CBOE
ICE
CME
Return on Assets (Normalized)
 13.22%2.91%2.30%
Return on Equity (Normalized)
 25.43%15.11%15.36%
Return on Invested Capital (Normalized)
 19.12%9.94%14.10%
Return on Assets
CBOE
ICE
CME

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