Trade-Ideas: CME Group (CME) Is Today's Unusual Social Activity Stock
Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.Trade-Ideas LLC identified CME Group (CME) as an unusual social activity candidate. In addition to specific proprietary factors, Trade-Ideas identified CME Group as such a stock due to the following factors:
- CME has more that 20x the normal benchmarked social activity for this time of the day compared to its average of 2.67 mentions/day.
- CME has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $216.4 million.
Identifying stocks with 'Unusual Social Activity' tends to be a valuable process for traders looking to capitalize on the 'talk of the town' stocks that are basking in far more attention from the StockTwits financial community than normal. Good press? Bad press? It ultimately doesn't matter if it's good or bad if you know how to trade around the sentiment. Certain hedge funds use such data for their proprietary algorithms and it is not uncommon to see shared social sentiment play itself out in a stock's price trend.EXCLUSIVE OFFER: Get the inside scoop on opportunities in CME with the Ticky from Trade-Ideas. See the FREE profile for CME NOW at Trade-IdeasMore details on CME: CME Group Inc. operates the CME, CBOT, NYMEX COMEX, and KCBT futures exchanges worldwide. It operates CBOT exchange, a marketplace for trading agricultural and the U.S. The stock currently has a dividend yield of 2.4%. CME has a PE ratio of 26.2. Currently there are 6 analysts that rate CME Group a buy, 1 analyst rates it a sell, and 5 rate it a hold.The average volume for CME Group has been 2.0 million shares per day over the past 30 days. CME Group has a market cap of $25.1 billion and is part of the financial sector and financial services industry. The stock has a beta of 1.12 and a short float of 2.1% with 1.98 days to cover. Shares are down 6.7% year-to-date as of the close of trading on Monday.STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.TheStreetRatings.com Analysis:TheStreet Quant Ratings rates CME Group as a hold. The company's strengths can be seen in multiple areas, such as its solid stock price performance, revenue growth and reasonable valuation levels. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity and weak operating cash flow.Highlights from the ratings report include:
- Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 27.87% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
- Despite its growing revenue, the company underperformed as compared with the industry average of 13.4%. Since the same quarter one year prior, revenues slightly increased by 4.4%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- Although CME's debt-to-equity ratio of 0.13 is very low, it is currently higher than that of the industry average. Even though the company has a strong debt-to-equity ratio, the quick ratio of 0.14 is very weak and demonstrates a lack of ability to pay short-term obligations.
- The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. When compared to other companies in the Diversified Financial Services industry and the overall market, CME GROUP INC's return on equity is below that of both the industry average and the S&P 500.
- Net operating cash flow has decreased to $129.80 million or 45.78% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
- You can view the full CME Group Ratings Report.
STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.
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