CBOE is the world's largest options exchange and is engaged in product innovation, options education and trading volume.
CBOE Holdings recently hit new highs on some surging stock volume, but the real clue has been the explosion in options trading. There has been some amazing growth from the use of derivatives by speculators and hedgers alike.
With very little competition in the industry, the CBOE boasts tremendous margins, new product innovations (including more weekly options and VIX products) and a strong financial position.
The chart confirms the fundamental reasons, too, and backing off the recent highs may be just the pullback we were looking for to enter a position. The recent bounce off the 50-day moving average was on higher turnover, hot money leaving the stock, giving way to the institutions to buy up the shares.
In addition, the MACD (moving average convergence divergence) is poised for a turn upward.
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Separately, TheStreet Ratings Team has a "Buy" rating with a score of A on the stock.
The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, notable return on equity, reasonable valuation levels and solid stock price performance.
The team believes its strengths outweigh the fact that the company shows weak operating cash flow.
Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
You can view the full analysis from the report here: CBOE