CBOE stock holds Neutral rating at UBS on strong trading volumes

Investing.com - UBS maintained its Neutral rating and $245.00 price target on CBOE Holdings (NYSE:CBOE) following the company’s June metrics release. The stock, currently trading at $229.11, sits near its 52-week high of $241.22, with InvestingPro data showing a "GREAT" financial health score of 3.06.

UBS increased its second-quarter 2025 earnings per share estimate by approximately 2% to $2.44 from $2.40, compared to the Street consensus of $2.42, citing stronger-than-expected performance in the index options business. With the next earnings report due on August 1, investors should note CBOE’s impressive 15.76% revenue growth over the last twelve months.

The firm raised its quarterly revenue estimate by 1%, primarily due to higher average daily volumes and revenue per contract in the index options segment than previously forecast.

UBS expects CBOE’s total net revenue to increase 12% year-over-year in the second quarter, driven by index options strength with volumes up 17% year-over-year, while equity options volumes rose 22% compared to the same period last year.

Despite recent volatility and strong trading volumes supporting CBOE’s stock performance, UBS indicated it continues to prefer other companies in its coverage universe that benefit from the current market volatility theme. The company maintains a strong dividend track record, having raised payments for 10 consecutive years, with a current yield of 1.13%. For deeper insights into CBOE’s valuation and growth prospects, access the comprehensive Pro Research Report available on InvestingPro.

In other recent news, Cboe Global Markets has reported mixed trading volumes for May 2025. The company saw a 27.6% year-over-year increase in multiply-listed options contracts, despite a slight decline from the previous month. Index options also rose by 14.7% compared to the previous year, though futures contracts experienced a notable decrease. In a strategic move, Cboe has migrated its bitcoin and ether futures to the Cboe Futures Exchange, aiming to enhance customer access and efficiency through a unified platform. This transition is part of Cboe’s efforts to expand its futures ecosystem and improve its technological offerings. Meanwhile, Morgan Stanley (NYSE:MS) has downgraded Cboe Holdings to an Underweight rating, citing concerns over declining volatility and its potential impact on index options volumes. The firm has adjusted its price target to $215, reflecting a cautious outlook on Cboe’s growth prospects. Additionally, Cboe announced executive leadership changes, with Dave Howson resigning and expanded roles for Cathy Clay and Chris Isaacson. Raymond (NSE:RYMD) James maintained a Market Perform rating on Cboe, expressing uncertainty about the sustainability of growth in its proprietary products.

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