CME Group (NASDAQ:CME) EPS Boosted on November Volumes

Citing November volumes as the catalyst, Ticonderoga increased their EPS estimate on CME Group (NASDAQ:CME) for the fourth quarter of 2010.

Ticonderoga said, "On the back of strong November volumes (the second strongest month of 2010), we are raising our 4Q10 EPS estimate to $3.90 from $3.58. We are now 6% above consensus estimates and we see upside potential to our estimates depending on whether December volumes hold up. For 4Q10, we are forecasting ADV of 12.2m contracts (up 19% YOY and 5% seq.), which builds in December ADV of 11.3m (down 20% from November levels). Given current open interest levels and continued volatility across many asset classes (particularly rates, FX, and energy), we remain bullish on volumes in the near term. We like CME and pairing CME long vs. CBOE short here given multiple differentials (CME trading at a 4% discount to CBOE), potential liquidity event for CBOE in Dec. given lockup expiration, and more bullish outlook for CME's asset classes vs. equity options in the near term. And in the near term, we would expect CME to outperform ICE as well given more upside to 4Q estimates, slightly better volume trends at CME and a more attractive valuation."

Ticonderoga maintains a "Buy' on CME Group, which closed at $312.50, up by $12.46, or 4.15 percent. Ticonderoga has a price target on them of $370.