Cboe Faces Downgrade: Analyst Warns Of Earnings Risks Amid Valuation Concerns And Sluggish Volume
Morgan Stanley analyst Michael J. Cyprys downgraded Cboe Global Markets, Inc. (BATS:CBOE) to Underweight from Equal-Weight, with a price forecast of $199 (unchanged).
The analyst highlights three key concerns that could impact earnings, sentiment, and valuation, leading to their downgrade: decelerating volume growth, limited potential for margin expansion due to management’s focus on stability and investments, and a preference for M&A over divestitures, with fewer share repurchases.
The analyst explains that the stock was downgraded due to its premium valuation, which seems to reflect expectations of strong topline growth. However, risks are seen in decelerating volumes and revenue, which could result in earnings disappointments and a contraction …
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