CME – Market expectations are for Uniform ROA to expand significantly, but management is concerned about contract volume and the NEX acquisition

• CME Group Inc. (CME:USA) currently trades near historical highs relative to UAFRS-based (Uniform) Assets, with a 43.4x Uniform P/E. At these levels, markets have bullish expectations for the firm, but management has concerns about contract volume and the NEX acquisition integration
• Specifically, management may be exaggerating their ability to sustain record volume and revenue performance and the cost benefit of their interest rate swaps for treasury future hedging. Moreover, they may be concerned about their synergies and customer outreach plans with NEX and the rate of integration of the acquisition.