Insider Move: Charles P Carey Invests $240K In CME Gr Stock

A significant insider buy by Charles P Carey, Director at CME Gr CME, was executed on June 27, and reported in the recent SEC filing.

What Happened: Carey demonstrated confidence in CME Gr by purchasing 1,237 shares, as reported in a Form 4 filing with the U.S. Securities and Exchange Commission on Thursday. The total value of the transaction is $240,101.

In the Thursday's morning session, CME Gr's shares are currently trading at $195.63, experiencing a up of 0.22%.

Discovering CME Gr: A Closer Look

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 CME was founded in 1898 and in 2002 completed its initial public offering. 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 in 2018, it has also expanded into cash foreign exchange, fixed income trading, and collateral optimization.

CME Gr's Economic Impact: An Analysis

Positive Revenue Trend: Examining CME Gr's financials over 3 months reveals a positive narrative. The company achieved a noteworthy revenue growth rate of 3.21% as of 31 March, 2024, showcasing a substantial increase in top-line earnings. In comparison to its industry peers, the company trails behind with a growth rate lower than the average among peers in the Financials sector.

Profitability Metrics:

• Gross Margin: The company maintains a high gross margin of 86.16%, indicating strong cost management and profitability compared to its peers.

• Earnings per Share (EPS): CME Gr's EPS outshines the industry average, indicating a strong bottom-line trend with a current EPS of 2.35.

Debt Management: CME Gr's debt-to-equity ratio is below the industry average at 0.13, reflecting a lower dependency on debt financing and a more conservative financial approach.

Valuation Analysis:

• Price to Earnings (P/E) Ratio: CME Gr's P/E ratio of 22.23 is below the industry average, suggesting the stock may be undervalued.

• Price to Sales (P/S) Ratio: With a relatively high Price to Sales ratio of 12.48 as compared to the industry average, the stock might be considered overvalued based on sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): With an EV/EBITDA ratio lower than industry averages at 15.62, CME Gr could be considered undervalued.

Market Capitalization: Boasting an elevated market capitalization, the company surpasses industry averages. This signals substantial size and strong market recognition.

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Exploring the Significance of Insider Trading

While insider transactions should not be the sole basis for making investment decisions, they can play a significant role in an investor's decision-making process.

In legal terms, an "insider" refers to any officer, director, or beneficial owner of more than ten percent of a company's equity securities registered under Section 12 of the Securities Exchange Act of 1934. This can include executives in the c-suite and large hedge funds. These insiders are required to let the public know of their transactions via a Form 4 filing, which must be filed within two business days of the transaction.

When a company insider makes a new purchase, that is an indication that they expect the stock to rise.

Insider sells, on the other hand, can be made for a variety of reasons, and may not necessarily mean that the seller thinks the stock will go down.

Cracking Transaction Codes

For investors, a primary focus lies on transactions occurring in the open market, as indicated in Table I of the Form 4 filing. A P in Box 3 denotes a purchase, while S signifies 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 Gr's Insider Trades.

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