145K Reasons To Be Bullish On CME Group Stock

A notable insider purchase on June 26, was reported by Patrick J Mulchrone, Director at CME Group CME, based on the most recent SEC filing.

What Happened: A Form 4 filing with the U.S. Securities and Exchange Commission on Thursday unveiled that Mulchrone made a notable purchase of 532 shares of CME Group, valuing at $145,251.

In the Friday's morning session, CME Group's shares are currently trading at $273.85, experiencing a up of 0.37%.

Unveiling the Story Behind CME Group

Based in Chicago, CME Group operates exchanges giving investors, suppliers, and businesses the ability to trade futures and derivatives based on interest rates, equity indexes, foreign currencies, energy, metals, and commodities. The Chicago Mercantile Exchange was founded in 1898 and in 2002 completed its IPO. Since then, CME Group has consolidated parts of the industry by merging with crosstown rival CBOT Holdings in 2007 before acquiring Nymex Holdings in 2008 and NEX in 2018. In addition, the company has a 27% stake in S&P Dow Jones Indices, making the Chicago Mercantile Exchange the exclusive venue to trade and clear S&P futures contracts. Through CME's acquisition of NEX, it also expanded into cash foreign exchange, fixed-income trading, and collateral optimization.

Financial Milestones: CME Group's Journey

Revenue Growth: CME Group's revenue growth over a period of 3 months has been noteworthy. As of 31 March, 2025, the company achieved a revenue growth rate of approximately 10.38%. This indicates a substantial increase in the company's top-line earnings. In comparison to its industry peers, the company stands out with a growth rate higher than the average among peers in the Financials sector.

Profitability Metrics:

• Gross Margin: The company maintains a high gross margin of 87.41%, indicating strong cost management and profitability compared to its peers.

• Earnings per Share (EPS): CME Group's EPS outshines the industry average, indicating a strong bottom-line trend with a current EPS of 2.63.

Debt Management: The company maintains a balanced debt approach with a debt-to-equity ratio below industry norms, standing at 0.13.

Evaluating Valuation:

• Price to Earnings (P/E) Ratio: CME Group's P/E ratio of 27.45 is below the industry average, suggesting the stock may be undervalued.

• Price to Sales (P/S) Ratio: The current P/S ratio of 15.63 is above industry norms, reflecting an elevated valuation for CME Group's stock and potential overvaluation based on sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): At 19.39, CME Group's EV/EBITDA ratio reflects a below-par valuation compared to industry averages signalling undervaluation

Market Capitalization Highlights: Above the industry average, the company's market capitalization signifies a significant scale, indicating strong confidence and market prominence.

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Why Insider Transactions Are Important

It's important to note that insider transactions alone should not dictate investment decisions, but they can provide valuable insights.

When discussing legal matters, the term "insider" refers to any officer, director, or beneficial owner holding more than ten percent of a company's equity securities, as stipulated in Section 12 of the Securities Exchange Act of 1934. This includes executives in the c-suite and significant hedge funds. Such insiders are required to report their transactions through a Form 4 filing, which must be completed within two business days of the transaction.

A new purchase by a company insider is a indication that they anticipate the stock will rise.

On the other hand, insider sells may not necessarily indicate a bearish view and can be motivated by various factors.

Cracking Transaction Codes

When it comes to transactions, investors tend to focus on those in the open market, detailed in Table I of the Form 4 filing. A P in Box 3 denotes a purchase, while S indicates a sale. Transaction code C signals the conversion of an option, and transaction code A denotes a grant, award, or other acquisition of securities from the company.

Check Out The Full List Of CME Group's Insider Trades.

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This article was generated by Benzinga's automated content engine and reviewed by an editor.