The CME Group (CME) reported May volumes today that showed weak growth: 4% year-over-year. While this tepid increase was expected, Deutsche cut its target price anyway.
CME is currently trading down below $400 after receiving a $1 billion settlement, regarding trading rights, from the Chicago Board Options Exchange. Yet Deutsche’s target price of $600 coupled with a HOLD rating looked to be about 6 months behind the times. Our guess is they were looking for any reason to lower the target.
The target now sits at $525, but, strangely, Deutsche stubbornly maintains its HOLD because they are taking “a more negative view on volumes”.
30%+ upside and a HOLD rating? Is this a case of wanting to have cake and eat it, too?
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