CME Group (NASDAQ:CME) versus MarketWise (NASDAQ:MKTW) Financial Comparison

MarketWise (NASDAQ:MKTW) and CME Group (NASDAQ:CME) are both financial services companies, but which is the superior stock? We will compare the two businesses based on the strength of their risk, earnings, analyst recommendations, institutional ownership, profitability, dividends and valuation.

Valuation and Earnings

This table compares MarketWise and CME Group”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
MarketWise	$432.34 million	0.44	$1.78 million	$0.08	7.50
CME Group	$6.04 billion	13.53	$3.23 billion	$8.79	25.84

CME Group has higher revenue and earnings than MarketWise. MarketWise is trading at a lower price-to-earnings ratio than CME Group, indicating that it is currently the more affordable of the two stocks.

Dividends

MarketWise pays an annual dividend of $0.04 per share and has a dividend yield of 6.7%. CME Group pays an annual dividend of $4.60 per share and has a dividend yield of 2.0%. MarketWise pays out 50.0% of its earnings in the form of a dividend. CME Group pays out 52.3% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. CME Group has raised its dividend for 14 consecutive years. MarketWise is clearly the better dividend stock, given its higher yield and lower payout ratio.

Institutional & Insider Ownership

23.0% of MarketWise shares are owned by institutional investors. Comparatively, 87.8% of CME Group shares are owned by institutional investors. 28.6% of MarketWise shares are owned by company insiders. Comparatively, 0.3% of CME Group shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Profitability

This table compares MarketWise and CME Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
MarketWise	0.80%	-1.30%	0.91%
CME Group	56.98%	12.82%	2.75%

Analyst Recommendations

This is a summary of recent recommendations for MarketWise and CME Group, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
MarketWise	0	1	1	0	2.50
CME Group	4	7	4	0	2.00

MarketWise presently has a consensus target price of $2.50, indicating a potential upside of 316.53%. CME Group has a consensus target price of $222.73, indicating a potential downside of 1.92%. Given MarketWise’s stronger consensus rating and higher probable upside, analysts clearly believe MarketWise is more favorable than CME Group.

Risk & Volatility

MarketWise has a beta of 0.44, indicating that its stock price is 56% less volatile than the S&P 500. Comparatively, CME Group has a beta of 0.55, indicating that its stock price is 45% less volatile than the S&P 500.

Summary

CME Group beats MarketWise on 12 of the 17 factors compared between the two stocks.

About MarketWise

MarketWise, Inc. operates a content and technology multi-brand platform for self-directed investors in the United States and Internationally. Its platform includes subscription businesses that provides financial research, software, education, and tools to navigate the financial markets. The company offers various investment strategies, such as value investing, income, growth, commodities, cryptocurrencies, venture, crowdfunded investing, biotechnology, mutual funds, options, and trading; investment research product portfolio through a range of media, including desktops, laptops, tablets, and mobile; and financial newsletters. It provides a suite of stock research tools and portfolio management services under the Chaikin Analytics brand; portfolio management software tools under the TradeSmith brand name; and database of accounting-based financial summaries under the Altimetry brand. In addition, the company develops screeners, monitors, portfolio management tools, and proprietary indicators that produce a composite score to rank publicly traded companies. The company was founded in 1999 and is headquartered in Baltimore, Maryland.

About CME Group

CME Group Inc., together with its subsidiaries, operates contract markets for the trading of futures and options on futures contracts worldwide. It offers futures and options products based on interest rates, equity indexes, foreign exchange, agricultural commodities, energy, and metals, as well as fixed income and foreign currency trading services. The company also provides clearing house services, including clearing, settling, and guaranteeing futures and options contracts, and cleared swaps products traded through its exchanges; and trade processing and risk mitigation services. In addition, the company offers a range of market data services, including real-time and historical data services. It serves professional traders, financial institutions, institutional and individual investors, corporations, manufacturers, producers, governments, and central banks. The company was formerly known as Chicago Mercantile Exchange Holdings Inc. and changed its name to CME Group Inc. in July 2007. The company was founded in 1898 and is headquartered in Chicago, Illinois.