UPDATE: J.P. Morgan Upgrades CME Group on 'Normalized Volume Analysis Suggests CME Over-Earning, but Volatility May Last'
In a report published on Tuesday, J.P. Morgan analyst Kenneth B. Worthington upgraded CME Group (NASDAQ: CME) from Underweight to Neutral and raised the price target from $52 to $72.
In the report, J.P. Morgan stated, "While surging volume has appropriately driven the stock to recent highs, making our call clearly wrong, we hesitate to recommend the stock at this price and valuation level given the potential for volatility to stabilize and for volumes to normalize. When valuing the stock from here, we look to address what are normalized earnings. The thought is that while CME volumes have been depressed for some time, they are likely being overstated currently. However, even if CME is over-earning, we don't see the near-term catalyst for such volatility to wane. As such, we think the Neutral rating most appropriate."
CME Group closed on Monday at $76.06.
(c) 2013 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.