Breaking News - I’ve started to nibble at CBOE 
I’ve been notably bearish on the name for the last ~4 months – I’ll lay out the reason for my pivot from bear to cautious bull below.
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Valuation is just too low now for sentiment to get worse from here. CBOE is trading at 17x 2020 EPS AND 2021 EPS (no growth projected in 2021). Any positive surprises can push this multiple back to peers (at least 20x)
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As always, there are risks (more VIX blow ups, poor Europe execution, loss of market share in equities), but those seem priced in now. I’m now long CBOE at ~$86, and may buy more if price slides from here.
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I’m positive on
$CBOE as well and view what they are seeking to build in Europe as not baked into the price (arguably negative given near term cost to build) but inherently big upside if successful (hidden option value) Would love to get views on 2 risks: -
1) Impact from MEMX launch. Cash equity market share already eroding a bit, have to believe a new entrant takes some additional share from all participants. Management seems to minimize this but would be curious what others think, is this a big risk or just noise?
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