CME Group Inc. CME is slated to report fourth-quarter 2024 earnings on Feb. 12, before market open. CME's earnings beat estimates in each of the trailing four quarters.

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Factors to Consider

A diverse product portfolio, increased volatility and a strong market position are likely to have aided CME Group’s performance in the fourth quarter.

Increases in market data and information services, clearing, transaction fees and other revenues are expected to have aided CME’s top line in the to-be-reported quarter. The Zacks Consensus Estimate for revenues is pegged at $1.51 billion, indicating a rise of 4.6% from the year-ago reported figure.

Clearing and transaction fees are likely to have benefited from higher trading volumes across asset classes. We expect clearing and transaction fees to be $1.2 billion, indicating a 0.7% increase from the year-ago reported figure. The Zacks Consensus Estimate for fourth-quarter clearing and transaction fees is pegged at $1.2 billion, indicating a rise of 2.4% from the year-ago reported figure.

CME reported a record quarterly average daily volume of 25.5 million contracts in the fourth quarter. Energy ADV increased 17% to 2.5 million contracts, Agricultural ADV rose 19% to 1.8 million contracts, Metals ADV grew 10% and Cryptocurrency ADV jumped 307%.

Market data and information services revenues are likely to have gained from price increases for certain products, a rise in device counts, higher custody fees as well as improvements in co-location and other connectivity fees. We expect the figure to be $189.7 million, indicating a 13.5% increase from the year-ago reported figure. The Zacks Consensus Estimate for fourth-quarter market data and information services revenues is pegged at $180 million, indicating an increase of 7.8% from the year-ago reported figure.

Expenses are likely to have increased in the to-be-reported quarter due to higher compensation and benefits, technology and amortization of purchased intangibles. We anticipate expenses to be $512.9 million in the to-be-reported quarter, indicating a 4.8% increase from the year-ago reported figure. 

The Zacks Consensus Estimate for fourth-quarter earnings per share is pegged at $2.44, indicating a rise of 2.9% from the year-ago quarter’s reported figure.

What the Zacks Model Says

Our proven model does not conclusively predict an earnings beat for CME Group this time around. This is because a stock needs to have the right combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). This is not the case, as you can see below.

Earnings ESP: CME Group has an Earnings ESP of -0.63%. This is because the Most Accurate Estimate of $2.43 is pegged lower than the Zacks Consensus Estimate of $2.44. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

Zacks Rank: CME Group currently carries a Zacks Rank of 3.

Stocks to Consider

Here are some stocks from the finance sector that have the perfect mix of elements to beat on earnings in their upcoming quarterly releases.

First American Financial Corporation FAF has an Earnings ESP of +5.00% and a Zacks Rank of 3 at present. The Zacks Consensus Estimate for fourth-quarter 2024 earnings is pegged at $1.07, indicating an increase of 55% from the year-ago reported figure. You can see the complete list of today’s Zacks #1 Rank stocks here.

FAF’s earnings beat estimates in two of the last four quarters while missing in the other two.

Kinsale Capital Group, Inc. KNSL has an Earnings ESP of +1.00% and a Zacks Rank of 3 at present. The Zacks Consensus Estimate for fourth-quarter 2024 earnings is pegged at $4.34, indicating an increase of 12.1% from the year-ago reported figure. 

KNSL’s earnings beat estimates in each of the last four quarters.

HCI Group, Inc. HCI has an Earnings ESP of +43.46% and a Zacks Rank of 3 at present. The Zacks Consensus Estimate for fourth-quarter 2024 earnings is pegged at a loss of $2.75, indicating a decrease of 185.4% from the year-ago reported figure. 

HCI’s earnings beat estimates in each of the last four quarters.

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CME Group Inc. (CME) : Free Stock Analysis Report

First American Financial Corporation (FAF) : Free Stock Analysis Report

HCI Group, Inc. (HCI) : Free Stock Analysis Report

Kinsale Capital Group, Inc. (KNSL) : Free Stock Analysis Report

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