TD Cowen has revised its price target for Raymond James (RJF, Financial), increasing it from $131 to $152, while maintaining its Hold rating on the stock. This adjustment follows an analysis of the company's recent second-quarter results, highlighting a significant uptick in capital returns. However, the firm noted that while long-term growth prospects remain promising, the current market environment presents challenges that could hinder immediate earnings growth.
Despite these hurdles, Raymond James has demonstrated a stronger and more consistent approach to returning capital. Yet, the visibility for deals has lessened, contributing to the mixed tactical outlook. Investors are advised to consider these factors when evaluating the stock's potential in the near term.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 11 analysts, the average target price for Raymond James Financial Inc (RJF, Financial) is $159.91 with a high estimate of $200.00 and a low estimate of $126.00. The average target implies an upside of 18.16% from the current price of $135.33. More detailed estimate data can be found on the Raymond James Financial Inc (RJF) Forecast page.
Based on the consensus recommendation from 15 brokerage firms, Raymond James Financial Inc's (RJF, Financial) average brokerage recommendation is currently 2.5, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Raymond James Financial Inc (RJF, Financial) in one year is $147.42, suggesting a upside of 8.93% from the current price of $135.33. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Raymond James Financial Inc (RJF) Summary page.
RJF Key Business Developments
Release Date: April 23, 2025
- Net Revenues: $3.4 billion for the fiscal second quarter, up 9% year-over-year.
- Pre-Tax Income: $671 million, a 10% increase over the year-ago quarter.
- Net Income Available to Common Shareholders: $493 million.
- Earnings Per Diluted Share: $2.36; adjusted earnings per diluted share of $2.42.
- Pre-Tax Margin: 19.7%; adjusted pre-tax margin of 20.3%.
- Return on Common Equity: 16.4%; adjusted return on tangible common equity of 19.7%.
- Client Assets Under Administration: $1.54 trillion, a 6% year-over-year growth.
- Net New Assets: $8.8 billion, representing a 2.6% annualized growth rate.
- Loans: Ended the quarter at a record $48.3 billion.
- Share Repurchases: $250 million during the quarter at an average share price of $146; additional $190 million in April at $125 per share.
- Private Client Group Revenues: $2.49 billion, driven by 6% higher assets under administration.
- Capital Markets Revenues: $396 million, with a 23% year-over-year growth.
- Asset Management Revenues: $289 million, with strong net inflows of $3.7 billion.
- Bank Segment Revenues: $434 million, with a net interest margin of 2.67%.
- Compensation Expense: $2.2 billion, with a total compensation ratio of 64.8%.
- Non-Compensation Expenses: $528 million, a 2% sequential increase.
- Effective Tax Rate: 26.2% for the quarter.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Raymond James Financial Inc (RJF, Financial) reported strong financial results with quarterly net revenues of $3.4 billion and pre-tax income of $671 million, reflecting year-over-year growth of 9% and 10%, respectively.
- The Private Client Group ended the quarter with $1.54 trillion of client assets under administration, representing a year-over-year growth of 6%.
- The firm achieved record net revenues of $6.9 billion and record pre-tax income of $1.4 billion for the first six months of fiscal 2025, up 13% and 15% over the first half of fiscal 2024.
- Raymond James Financial Inc (RJF) was ranked number one in the 2025 J.D. Power Survey for Advised Investor Satisfaction and Industry Trust.
- The company has resumed share repurchases, buying back $250 million of common stock during the quarter and an additional $190 million in April, reflecting confidence in its long-term returns.
Negative Points
- The investment banking segment faced challenges due to market uncertainty and heightened volatility, impacting the timing of closings.
- Net new assets (NNA) were lower this quarter, similar to the same quarter in fiscal 2024, although there was improvement throughout the quarter.
- The fixed income market at the start of the third quarter is challenging, with market and interest rate uncertainty posing significant headwinds.
- The bank segment's net interest income grew only 1% sequentially, with a 7-basis point expansion of net interest margin to 2.67%, indicating modest growth.
- The company is no longer pursuing certain M&A opportunities due to valuation concerns, which may impact future growth prospects.
