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Cboe Global Markets Inc. (CBOE) Stock

Cboe Global Markets Inc. Stock Details, Movements and Public Alerts

Cboe Global Markets (CBOE): The $22B Options Exchange Oligopoly With 50% Market Share

When traders buy SPX options to hedge portfolios or speculate on volatility, there's a 50% chance that trade executes on Cboe Global Markets' platforms. CEO Fredric Tomczyk oversees the Chicago-based exchange operator that invented listed options in 1973 and created the VIX Index—Wall Street's 'fear gauge.' Cboe processes 12 million option contracts daily across equities, indices, ETFs, and futures, earning fractions of a penny per contract. This high-volume, low-margin business generates $4.5 billion in annual revenue with 70% EBITDA margins—classic toll-booth economics. Unlike banks or brokers exposed to market risk, Cboe simply facilitates trades, earning fees whether markets rise or fall. Volatility actually helps: when the VIX spikes and investors panic-hedge, option volumes surge 50-100%, driving record revenues. Beyond trading, Cboe operates a $1.2 billion data/analytics business selling market data feeds to Bloomberg, hedge funds, and brokers. Trading at 25x earnings with 1.5% dividend yield, Cboe offers exchange sector quality—recession-resistant revenues, oligopoly pricing power, and structural growth from options adoption.

52-Week Range

$254.49 - $185.65

-6.83% from high · +27.71% from low

Avg Daily Volume

1,124,950

Latest volume

Fundamentals

Valuation Metrics

P/E Ratio (TTM)

28.45

Above market average

Forward P/E

25.06

Earnings expected to grow

PEG Ratio

2.15

Potentially overvalued

Price to Book

5.46

EV/EBITDA

17.67

EPS (TTM)

$8.62

Price to Sales

5.66

Beta

0.45

Less volatile than market

How is CBOE valued relative to its earnings and growth?
Cboe Global Markets Inc. trades at a P/E ratio of 28.45, which is above the market average of approximately 20. This premium valuation suggests investors expect above-average growth or the company has competitive advantages justifying the higher multiple. Looking ahead, the forward P/E of 25.06 is lower than the current P/E, indicating analysts expect earnings to grow over the next year. The PEG ratio of 2.15 indicates a premium valuation even accounting for growth.
What is CBOE's risk profile compared to the market?
With a beta of 0.45, Cboe Global Markets Inc. is less volatile than the overall market. This means when the market moves up or down by 10%, this stock typically moves less than 10% in the same direction. Lower beta stocks are often preferred by conservative investors seeking stability. The price-to-book ratio of 5.46 shows investors value the company above its book value, which often reflects intangible assets or growth prospects.

Performance & Growth

Profit Margin

19.90%

Operating Margin

30.30%

EBITDA

$1.43B

Return on Equity

20.70%

Return on Assets

8.98%

Revenue Growth (YoY)

20.50%

Earnings Growth (YoY)

67.80%

How profitable and efficient is CBOE's business model?
Cboe Global Markets Inc. achieves a profit margin of 19.90%, meaning it retains $19.90 from every $100 in revenue after all expenses. This is an impressive margin, indicating strong pricing power and efficient cost management that allows the company to generate substantial profits. The operating margin of 30.30% reveals how efficiently the company runs its core business operations before interest and taxes. With ROE at 20.70% and ROA at 8.98%, the company generates strong returns on invested capital.
What are CBOE's recent growth trends?
Cboe Global Markets Inc.'s revenue grew by 20.50% year-over-year, representing robust expansion that significantly outpaces typical market growth rates. This strong top-line performance suggests the company is successfully capturing market share or benefiting from favorable industry trends. Earnings increased by 67.80% year-over-year, outpacing revenue growth through improved margins. These growth metrics should be evaluated against FINANCIAL DATA & STOCK EXCHANGES industry averages for proper context.

Dividend Information

Dividend Per Share

$2.52

Dividend Yield

1.02%

Ex-Dividend Date

Aug 29, 2025

Dividend Date

Sep 15, 2025

What dividend income can investors expect from CBOE?
Cboe Global Markets Inc. offers a dividend yield of 1.02%, paying $2.52 per share annually. This modest yield below 2% suggests the company prioritizes growth investments over current income. While the dividend provides some return, investors are likely attracted more by capital appreciation potential than income generation. To receive the next dividend, shares must be purchased before the ex-dividend date of Aug 29, 2025.
How reliable is CBOE's dividend for long-term investors?
The dividend sustainability can be assessed through the payout ratio - Cboe Global Markets Inc. pays $2.52 per share in dividends against earnings of $8.62 per share, resulting in a payout ratio of 29.23%. This conservative payout below 30% indicates excellent dividend safety with substantial room for future increases. The company retains most earnings for growth while still rewarding shareholders. The next dividend payment is scheduled for Sep 15, 2025.

Company Size & Market

Market Cap

$25.7B

Revenue (TTM)

$4.53B

Revenue/Share (TTM)

$43.26

Shares Outstanding

104.59M

Book Value/Share

$44.60

Asset Type

Common Stock

What is CBOE's market capitalization and position?
Cboe Global Markets Inc. has a market capitalization of $25.7B, classifying it as a large-cap stock ($10B-$200B). Large-caps are typically industry leaders with established business models, offering a balance of stability and growth potential. They often provide dividend income and are core holdings in institutional portfolios. With 104.59M shares outstanding, the company's ownership is relatively concentrated. As a participant in the FINANCIAL DATA & STOCK EXCHANGES industry, it competes with other firms in this sector.
How does CBOE's price compare to its book value?
Cboe Global Markets Inc.'s book value per share is $44.60, while the current stock price is $237.10, resulting in a price-to-book (P/B) ratio of 5.32. This high P/B ratio indicates significant intangible assets, strong brand value, or high growth expectations. Technology and consumer brand companies often trade at elevated P/B ratios due to intellectual property and competitive advantages not reflected on the balance sheet. As a common stock, this represents equity ownership with voting rights.

Analyst Ratings

Analyst Target Price

$245.56

3.57% upside potential

Analyst Recommendations

Strong Buy

1

Buy

2

Hold

13

Sell

2

Strong Sell

1

How reliable are analyst predictions for CBOE?
19 analysts cover CBOE with 16% recommending buy/strong buy ratings. Analyst predictions have mixed reliability - studies show consensus rarely beats market returns consistently. The bearish sentiment could create opportunity if analysts are wrong. The consensus target of $245.56 implies 3.6% upside, but targets are often adjusted to follow price moves rather than predict them.
What is the Wall Street consensus on CBOE?
Current analyst recommendations:1 Strong Buy, 2 Buy, 13 Hold, 2 Sell, 1 Strong Sell. The neutral stance suggests uncertainty or fair valuation at current levels.Remember that analyst opinions often lag price movements and can be influenced by investment banking relationships.

Fundamentals last updated: Oct 1, 2025, 05:41 AM

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Cboe Global Markets (CBOE) Stock Analysis 2025: Complete Investment Guide

The Exchange That Invented Listed Options

In 1973, the Chicago Board Options Exchange (CBOE) created the first standardized, exchange-traded options market. Before CBOE, options traded over-the-counter in inefficient, opaque markets. Cboe's innovation—standardized strike prices, expiration dates, and central clearing—democratized options for retail investors and institutional hedgers. Fredric Tomczyk, CEO since 2017, inherited a company processing 6 million daily contracts and transformed it through acquisitions (BATS Global Markets for $3.2B in 2017) into a diversified exchange group. Today, Cboe operates four business segments: Options (50% of revenue), U.S. Equities (20%), Futures (15%), and European/APAC Markets (15%). The core Options franchise dominates: Cboe's share of U.S. equity options exceeds 50%, while index options (SPX, VIX, Russell 2000) command 70%+ share due to proprietary products competitors can't replicate. This creates a durable moat—traders must use Cboe to access SPX options, the most liquid index derivatives globally.

Business Model & Competitive Moat

Cboe earns revenue three ways: transaction fees (60% of revenue), access fees for connecting to exchanges (20%), and data fees for real-time market data (20%). The business model is beautifully simple: charge fractions of a penny per contract, process billions of contracts annually, and generate 70% EBITDA margins with minimal capital requirements. The moat is oligopolistic market structure—only 12 U.S. options exchanges exist (vs. 100+ in the 1990s), creating rational pricing. Cboe competes with Nasdaq, NYSE, and smaller players but dominates through proprietary products (SPX, VIX options available only on Cboe) and market-making incentives. The weak point: potential for new entrants (FTX tried and failed) or regulatory intervention forcing fee reductions. However, exchange businesses benefit from network effects—liquidity attracts liquidity, making it nearly impossible for new exchanges to gain traction without massive subsidies. Tomczyk's strategy diversifies beyond options through equities trading (BATS brand), European exchanges (Cboe Europe), and data products (LiveVol analytics, Cboe DataShop), reducing reliance on U.S. options.

Financial Performance

  • •Revenue: $4.5B (2024), up 10% driven by volume growth and data subscriptions
  • •EBITDA Margin: 70%, among highest in financial services (exchange toll-booth economics)
  • •Net Income: $900M, P/E of 25x (premium to S&P 500 reflects quality)
  • •ROE: 15-18% despite low leverage (exchanges are capital-light)
  • •Free Cash Flow: $1.2B (27% of revenue), funding dividends + buybacks
  • •Dividend Yield: 1.5% with 10% annual growth rate (sustainable 40% payout)

Growth Catalysts

  • •Options Adoption: Retail options trading (Robinhood, 0DTE options) growing 25% annually
  • •Volatility Products: VIX futures/options volume up 40% as hedging demand increases
  • •Digital Assets: Cboe Digital launching crypto derivatives (Bitcoin, Ethereum futures/options)
  • •International Expansion: Cboe Europe capturing EU equity trading share from LSE, Euronext
  • •Data Monetization: Analytics subscriptions (LiveVol, Hanweck) growing 15% annually at 80% margins
  • •0DTE Options: Zero-days-to-expiration options (same-day expiry) now 50% of SPX volume, highly profitable

Risks & Challenges

  • •Regulatory Risk: SEC could force transaction fee reductions or mandate data fee transparency
  • •Competitive Pressure: Nasdaq, NYSE competing aggressively for options market share
  • •Technology Disruption: Decentralized exchanges (DeFi) or blockchain-based derivatives could disintermediate
  • •Volume Concentration: 20% of revenue from top 5 customers (market makers); customer consolidation risk
  • •Low Volatility Regime: If VIX stays below 15 for extended periods, options volumes decline 20-30%
  • •Antitrust Scrutiny: Cboe's dominance in index options could attract regulatory intervention

Competitive Landscape

ExchangeOptions ShareEquities ShareKey Strength
Cboe (CBOE)50%12%Index options monopoly
Nasdaq (NDAQ)25%15%Technology + listings
NYSE (ICE)15%25%Equities dominance
Others10%48%Fragmented

Cboe dominates options but lags in equities. Fredric Tomczyk's strategy leverages options leadership to cross-sell data products and expand internationally, rather than fighting costly equities market share battles.

Who Is This Stock Suitable For?

Perfect For

  • ✓Dividend growth investors seeking 1.5% yield + 10% annual increases
  • ✓Defensive/recession-resistant allocations (exchange revenues stable)
  • ✓Financial sector exposure without bank credit risk
  • ✓Long-term compounders (15-18% ROE, capital-light model)

Less Suitable For

  • ✗Value investors (25x P/E is premium, not cheap)
  • ✗High-yield seekers (1.5% below utilities/REITs)
  • ✗Growth investors (10% revenue growth vs. 20%+ for tech)
  • ✗Short-term traders (low volatility, slow-moving stock)

Investment Thesis

Cboe Global Markets offers exchange sector quality: oligopolistic market position, toll-booth economics, and recession-resistant revenues. At 25x earnings, the stock trades at a premium but reflects durability—Cboe's options dominance is nearly impossible to disrupt due to proprietary products (SPX, VIX) and network effects. The investment thesis: options trading adoption continues (retail, hedging demand, structured products), driving 10-12% annual volume growth. Cboe captures this growth with minimal capital requirements, converting 27% of revenue to free cash flow. Data revenue provides diversification and margin upside. Near-term catalysts include 0DTE options sustaining volumes, crypto derivatives launch, and international expansion. Risks are manageable—regulatory intervention possible but unlikely given liquid, efficient markets Cboe provides. For conservative investors seeking financial sector exposure without bank balance sheet risk, Cboe offers 10-12% annual total returns (6-8% capital appreciation + 1.5% yield + dividend growth). This is a core holding for balanced portfolios, sized at 2-3% for long-term compounding.

Conclusion

Cboe is a high-quality exchange compounder suitable for 2-3% core holdings in conservative portfolios. The stock merits a HOLD at current levels, BUY on weakness below $160. Not a sell unless regulatory risks materialize or valuations exceed 30x earnings. Recommended strategy: accumulate positions during market volatility when the stock dips, reinvest dividends, and hold for 10+ years capturing options adoption and dividend compounding. This is a 'sleep well at night' financial infrastructure play with 10-12% annual return potential and minimal cyclical risk.
Bull Case
$240 (30% upside) - Options volumes surge, crypto derivatives succeed, data revenue accelerates
Base Case
$195 (5% upside) - Steady volume growth, market share stable, dividend increases continue
Bear Case
$140 (25% downside) - Regulatory fee cuts, competitive pressures, low volatility regime persists

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