Top 3 Financial Stocks: CME Group
CME Group is
the largest market place for derivatives. CME stocks dropped by 25% from the
beginning of 2022. The only reason for such a decline is the overall market
correction and not any business issues. High volatility is a benefit for the
company as it offers the most important derivatives to mitigate financial
risks. Among those are the most popular S&P 500 index futures and other
indexes linked to derivatives, agricultural products, gold, silver, and crude
derivatives. So, the company continues to receive decent profit that allows for
the payment of high dividends to its investors.
Free Cash
Flow (FCF) of the company in 2022 is expected to hit $2.8 billion. CME is
improving its efficiency as every Dollar received in 2021 was converted into
$0.48 of FCF, while this year this figure is expected to rise to $0.55, and in
2023 to $0.57. Regular annual dividends is at $4 or 2.3% of share value. CME is
also paying interim dividends. By doing so, it paid $3.6 regular dividend and
$3.25 interim dividends in 2021, or $6.85 per share, slightly above FCF per
share at $6.77.
CME has a
solid business model and sound financials without substantial debt. These facts
allow the management to take more care of the company’s shareholders. The current
overall downside configuration offers great opportunities for investors to add
CME stocks to their long-term investment portfolios.
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