How Does Cboe’s Strong 2025 Performance Stack Up After Its 19% Rally?

If you're looking at Cboe Global Markets and wondering whether now is the time to make your move, you're not alone. This is a stock that has given investors plenty to talk about. Just glancing at its recent performance, there is a lot under the surface. Cboe closed at $234.37, running up an impressive 19.3% year-to-date and delivering a stellar 180% return over the past five years. Even if the stock dipped 7.2% in the past month and is down 0.7% for the week, its long-term strength is hard to ignore. Some of these swings trace back to shifts in the broader financial market landscape, where Cboe benefits as volatility and options trading trends draw more attention. As new products and market developments keep the spotlight on exchanges, investors’ perceptions of risk and growth potential are evolving fast.

Of course, past returns are just one part of the puzzle. With a valuation score of 1 out of 6, the numbers tell us this stock is undervalued on one important front but not an across-the-board bargain. So, how does Cboe really stack up when you weigh up different ways to value a business like this? Let’s break down the major valuation methods, and keep in mind there may be an even sharper lens for judging what the market might be missing about Cboe. More on that later in the article.

Cboe Global Markets scores just 1/6 on our valuation checks. See what other red flags we found in the full valuation breakdown.

Approach 1: Cboe Global Markets Excess Returns Analysis

The Excess Returns valuation approach estimates a company’s intrinsic worth by assessing how much profit Cboe can generate above its cost of capital using shareholder equity. This method is especially useful for businesses like Cboe, where return on invested capital and sustainable growth matter more than simple earnings comparisons.

Looking at the numbers, Cboe has a Book Value of $44.60 per share and is projected to maintain a stable EPS of $11.55 per share, based on estimates from eight analysts. The cost of equity stands at $4.41 per share, implying an Excess Return of $7.14 per share. Cboe’s average Return on Equity is 21.39%, and the company’s stable Book Value is forecasted to be $54.00 per share according to two analysts. These figures highlight Cboe’s strong ability to deliver value above its capital costs over time.

Using this approach, the estimated intrinsic value per share for Cboe Global Markets is $194.49. With the stock currently trading at $234.37, the figures suggest Cboe is about 20.5% overvalued based on its long-term ability to generate returns above its equity costs.

Story Continues Result: OVERVALUED

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Cboe Global Markets.

CBOE Discounted Cash Flow as at Sep 2025 Our Excess Returns analysis suggests Cboe Global Markets may be overvalued by 20.5%. Find undervalued stocks or create your own screener to find better value opportunities.

Approach 2: Cboe Global Markets Price vs Earnings

For profitable companies like Cboe Global Markets, the Price-to-Earnings (PE) ratio is a widely used metric because it directly ties the stock price to the company’s net profits. Investors favor the PE ratio for its simplicity and the way it reflects market expectations for a company’s earnings power.

However, what counts as a “normal” or “fair” PE ratio is not set in stone. Growth prospects, company-specific risks, and even shifts in the broader market all shape what investors are willing to pay for each dollar of earnings. High growth or lower risk might justify a higher PE, while riskier or slower-growing companies tend to trade on lower multiples.

Currently, Cboe trades at a PE ratio of 27.3x. For context, this is slightly above the Capital Markets industry average of 26.7x and lower than the peer group average of 34.2x. However, industry and peer comparisons alone do not capture the full story. This is where Simply Wall St’s proprietary “Fair Ratio” comes in. The Fair Ratio takes into account everything from Cboe’s earnings growth, profitability, and risk profile to its size and industry dynamics, providing a more tailored benchmark. Cboe’s calculated Fair Ratio is 14.9x, a level well below its current trading multiple. That suggests the shares are trading well above what you might expect, even after adjusting for Cboe’s strengths.

Result: OVERVALUED

BATS:CBOE PE Ratio as at Sep 2025 PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your Cboe Global Markets Narrative

Earlier, we mentioned that there is an even better way to understand valuation, so let's introduce you to Narratives. Narratives are a way for investors to bring their own perspective and reasoning to the numbers, connecting a company’s story, including its opportunities, risks, and future potential, to a financial forecast and ultimately to an estimated fair value. They make investing more approachable by allowing you to build and share your own story for a stock, combining your beliefs about future revenue, earnings, and margins with what you think the business is truly worth. The Narratives tool, found on Simply Wall St’s Community page and used by millions of investors, helps you decide whether to buy or sell by showing how your Fair Value compares to the market price. It updates instantly as new earnings or news come in. For example, one investor may believe Cboe’s international expansion justifies a fair value of $265, while another concerned about competition might only see it worth $216. This highlights how Narratives reflect real differences in outlook and support smarter, personalized investment decisions. Do you think there's more to the story for Cboe Global Markets? Create your own Narrative to let the Community know!

BATS:CBOE Community Fair Values as at Sep 2025 This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include CBOE.

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