Core Insights - Jefferies Financial Group (NYSE: JEF) is a full-service investment bank with a fiscal quarter Q2 that includes March, April, and May, making its earnings release significant for anticipating results from larger investment banks like Goldman Sachs [1] Group 1: Company Overview - Jefferies Financial Group operates as a full-service investment bank [1] Group 2: Earnings Significance - The earnings release of Jefferies is particularly valuable as it serves as a precursor to the earnings reports of larger investment banks [1]

Core Viewpoint - Jefferies Financial Group's second-quarter fiscal 2025 adjusted earnings of 43 cents per share matched estimates but declined from 67 cents per share in the prior-year quarter, indicating a challenging financial environment [1][9]. Financial Performance - Net income attributable to common shareholders was $88 million, down from $145.7 million in the prior-year quarter, reflecting a significant decrease in profitability [2]. - Quarterly net revenues were $1.63 billion, a decrease of 1.3% year over year, although it surpassed the Zacks Consensus Estimate of $1.56 billion [3]. - Total non-interest expenses rose to $1.50 billion, up 5% from the prior-year quarter, driven by increases in almost all cost components except for compensation and benefits and underwriting costs [3]. Segment Performance - In the Investment Banking and Capital Markets segment, net revenues were $1.47 billion, falling 1.6% from the prior-year quarter due to lower equity and debt underwriting and fixed-income performance, partially offset by strong performance in Equities [5]. - The Asset Management segment reported net revenues of $154.6 million, down 1.2% from the year-ago quarter [5]. Shareholder Returns - Jefferies announced a quarterly cash dividend of 40 cents per share, to be paid on August 29, 2025, to shareholders as of August 18 [6]. Book Value - As of May 31, 2025, the book value per common share was $49.96, an increase from $46.57 as of May 31, 2024, while the adjusted tangible book value per fully diluted share rose to $32.84 from $31.27 [4].

Core Insights - Jefferies reported $1.63 billion in revenue for the quarter ended May 2025, a year-over-year decline of 1.3% and an EPS of $0.43 compared to $0.67 a year ago, with a revenue surprise of +5.13% over the Zacks Consensus Estimate of $1.55 billion [1] Revenue Performance - Total Asset Management Net revenues were $154.62 million, exceeding the two-analyst average estimate of $128.63 million, representing a year-over-year change of -1.2% [4] - Total Investment Banking and Capital Markets Net revenues were $1.47 billion, compared to the $1.42 billion average estimate, reflecting a year-over-year change of -1.6% [4] - Total Capital Markets revenues were $704.16 million, slightly below the $720.30 million estimate, with a year-over-year change of +1.9% [4] - Total Investment Banking revenues were $766.31 million, exceeding the $704.64 million average estimate, showing a year-over-year decline of -4.6% [4] Key Metrics - Jefferies' shares returned +11.2% over the past month, outperforming the Zacks S&P 500 composite's +5.1% change, with a Zacks Rank 3 (Hold) indicating potential performance in line with the broader market [3] - Total Capital Markets - Equities revenues were $526.24 million, surpassing the $446.78 million estimate, with a year-over-year increase of +29.3% [4] - Total Investment Banking - Advisory revenues were $457.86 million, exceeding the $389.88 million estimate, reflecting a year-over-year increase of +61.3% [4]

Core Viewpoint - Jefferies reported quarterly earnings of $0.43 per share, matching the Zacks Consensus Estimate, but down from $0.67 per share a year ago [1]. Financial Performance - Revenues for the quarter ended May 2025 were $1.63 billion, exceeding the Zacks Consensus Estimate by 5.13%, but down from $1.66 billion year-over-year [2]. - Over the last four quarters, Jefferies has surpassed consensus EPS estimates only once and topped revenue estimates twice [2]. Stock Performance - Jefferies shares have declined approximately 29.4% year-to-date, contrasting with the S&P 500's gain of 3.6% [3]. - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the market in the near future [6]. Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.66 on revenues of $1.74 billion, and for the current fiscal year, it is $2.42 on revenues of $6.8 billion [7]. - The trend of earnings estimate revisions is mixed ahead of the earnings release, which may influence future stock movements [6]. Industry Context - The Financial - Miscellaneous Services industry, to which Jefferies belongs, is currently ranked in the top 35% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [8].

Core Insights - Jefferies reported a slight decline in total revenue for Q2 FY 2025 compared to Q2 FY 2024, with total revenue at $1.63 billion, down 1% [1] - Adjusted earnings per share fell significantly by 38% to $0.40, missing analysts' expectations [1][2] - Investment banking revenue decreased by 3% year-over-year, while capital markets revenue remained flat [1][3] Financial Performance - Total revenue for Q2 FY 2024 was $1.66 billion, while Q2 FY 2025 saw a decrease to $1.63 billion [1] - Adjusted earnings per share dropped from $0.64 to $0.40, falling short of expectations [1][2] - Investment banking revenue was $787.4 million in Q2 FY 2024 and decreased to $766.3 million in Q2 FY 2025 [1] - Capital markets revenue remained stable at $707.1 million in Q2 FY 2024 and $704.2 million in Q2 FY 2025 [1] Market Reaction - Following the earnings report, Jefferies shares fell nearly 2% in after-hours trading [5] - The stock had previously risen approximately 42% from its April lows but remains down about 29% year-to-date [6] Operational Insights - Jefferies experienced a significant increase in advisory revenue within its investment banking segment, driven by market share gains and higher M&A activity [3] - However, this was offset by a substantial decline in equity underwriting activity, leading to an overall decrease in investment banking sales [3] - In capital markets, equities performed well, particularly in Europe and Asia, while fixed income revenue faced challenges due to market volatility [4] Future Outlook - CEO Richard Handler expressed optimism about the company's prospects, citing resilience in the global economy and strong backlog figures [8] - Increased non-interest expenses, including higher brokerage and clearing fees, contributed to the earnings miss [7]

Financial Performance - Net earnings attributable to common shareholders for Q2 2025 were $88 million, or $0.40 per diluted common share, down from $145.7 million, or $0.64 per diluted common share in Q2 2024[2][10]. - Total net revenues for Q2 2025 were $1.63 billion, a slight decrease from $1.66 billion in Q2 2024, with year-to-date revenues at $3.23 billion compared to $3.39 billion in the previous year[2][10]. - Net earnings attributable to common shareholders for the three months ended May 31, 2025, were $88,017, compared to $145,736 in 2024, a decrease of approximately 39.5%[16]. - Net earnings from continuing operations for the three months ended May 31, 2025, were $91,395,000, a decrease of 40.8% compared to $154,647,000 for the same period in 2024[18]. - The net earnings attributable to common shareholders for basic earnings per share for the six months ended May 31, 2025, was $215,955,000, down from $301,237,000 in the same period of 2024, a decline of 28.4%[18]. Revenue Breakdown - Investment banking net revenues totaled $786 million for Q2 2025, up 6.4% year-over-year, driven by a 61% increase in Advisory revenues[6][10]. - Capital Markets net revenues were $704 million for Q2 2025, slightly down from $707 million in Q2 2024, with Equities net revenues increasing by 24% to $526 million[7][10]. - Asset Management fees and investment return revenues for Q2 2025 were $71 million, a 43% increase from the prior year quarter, attributed to improved performance across several strategies[8][10]. - Total revenues for the three months ended May 31, 2025, were $2,494,315, compared to $2,516,296 for the same period in 2024, reflecting a decrease of approximately 0.9%[16]. - Net revenues for the six months ended May 31, 2025, were $3,227,466, down from $3,394,648 in 2024, representing a decline of about 4.9%[16]. Expenses and Costs - Total non-interest expenses for the three months ended May 31, 2025, were $1,499,546, compared to $1,428,691 in 2024, an increase of approximately 4.9%[16]. - Interest expense for the six months ended May 31, 2025, was $1,739,713, compared to $1,673,590 in 2024, reflecting an increase of about 3.9%[16]. - Compensation and benefits for the three months ended May 31, 2025, were $854,839, compared to $861,993 in 2024, a slight decrease of approximately 0.2%[16]. - Brokerage and clearing fees for the six months ended May 31, 2025, were $239,181, compared to $220,206 in 2024, representing an increase of about 8.6%[16]. Shareholder Metrics - The company declared a quarterly cash dividend of $0.40 per common share, payable on August 29, 2025[3]. - Return on adjusted tangible shareholders' equity from continuing operations was 5.5% for Q2 2025, down from 9.1% in Q2 2024[2][10]. - The book value per common share increased to $49.96 in Q2 2025, up from $46.57 in Q2 2024[2][10]. - The weighted average diluted common shares outstanding for the three months ended May 31, 2025, were 221,897, a decrease from 226,146 in the same period of 2024[18]. - Common shares outstanding as of May 31, 2025, totaled 206,272 thousand, with adjusted fully diluted shares outstanding at 254,564 thousand[22]. Tax and Regulatory - The effective tax rate from continuing operations was 32.3% for Q2 2025, compared to 32.1% for the prior year quarter[10]. - The company reported an income tax expense of $43,506 for the three months ended May 31, 2025, compared to $73,107 in 2024, a decrease of approximately 40.5%[16]. Operational Insights - Management expressed optimism for the second half of 2025, citing a strong backlog and increased client discussions around capital formation and strategic opportunities[4][5]. - The company reported a leverage ratio of 6.5 for the three months ended May 31, 2025, compared to 6.8 for the same period in 2024[17]. - The number of employees at the end of the reporting period was 7,601, a slight increase from 7,577 in the previous year[17]. - Cash and cash equivalents as of May 31, 2025, totaled $1,126,000,000, compared to $1,117,000,000 as of May 31, 2024, reflecting a growth of 0.8%[17]. Discontinued Operations - The company experienced net losses attributable to noncontrolling interests of $7,668,000 for the three months ended May 31, 2025, compared to $3,785,000 in the same period of 2024[18]. - The company experienced a net earnings impact from discontinued operations of $5,861 thousand for the six months ended May 31, 2025[20].

Core Insights - Jefferies (JEF) is expected to report quarterly earnings of $0.43 per share, reflecting a year-over-year decline of 35.8% [1] - Anticipated revenues for the quarter are projected at $1.56 billion, indicating a decline of 6.1% compared to the same quarter last year [1] - The consensus EPS estimate has remained unchanged over the last 30 days, suggesting analysts have reevaluated their initial estimates [1][2] Revenue Estimates - Total Asset Management Net revenues are estimated at $123.77 million, showing a year-over-year change of -20.9% [4] - Total Investment Banking and Capital Markets Net revenues are projected to be $1.43 billion, indicating a decline of 4% year-over-year [4] - Total Asset Management Net revenues from Investment return are expected to be $11.57 million, reflecting a significant decline of 64.9% year-over-year [5] - Total Capital Markets revenues are anticipated to reach $718.46 million, suggesting a year-over-year increase of 3.9% [5] - Total Capital Markets - Equities revenues are projected at $440.68 million, indicating an increase of 8.3% from the previous year [6] - Total Investment Banking revenues are expected to be $715.69 million, reflecting a year-over-year decline of 10.9% [8] Underwriting and Advisory Estimates - Total Investment Banking - Total underwriting - Advisory revenues are estimated at $399.83 million, indicating a year-over-year increase of 40.8% [7] - Total Investment Banking - Other investment banking revenues are projected at $12.50 million, reflecting a significant decline of 80.7% year-over-year [7] - Total Investment Banking - Total underwriting revenues are expected to reach $303.36 million, indicating a year-over-year decline of 33.3% [9] - Total Investment Banking - Total underwriting - Equity underwriting revenues are projected at $129.07 million, reflecting a decline of 48.2% year-over-year [9] Market Performance - Over the past month, Jefferies shares have recorded returns of +10.1%, outperforming the Zacks S&P 500 composite's +0.6% change [9] - Based on its Zacks Rank 4 (Sell), Jefferies is expected to underperform the overall market in the upcoming period [10]

Core Viewpoint - Wall Street anticipates a year-over-year decline in Jefferies' earnings due to lower revenues, with a focus on how actual results will compare to estimates [1][3] Earnings Expectations - Jefferies is expected to report quarterly earnings of $0.43 per share, reflecting a year-over-year decrease of 35.8% [3] - Revenue is projected to be $1.56 billion, down 6.1% from the same quarter last year [3] Estimate Revisions - The consensus EPS estimate has remained unchanged over the last 30 days, indicating stability in analyst expectations [4] - A positive Earnings ESP of +8.24% suggests recent bullish sentiment among analysts regarding Jefferies' earnings prospects [12] Earnings Surprise Prediction - The Zacks Earnings ESP model indicates that a positive reading is a strong predictor of an earnings beat, especially when combined with a favorable Zacks Rank [10] - Jefferies currently holds a Zacks Rank of 4, which complicates the prediction of an earnings beat despite the positive Earnings ESP [12] Historical Performance - In the last reported quarter, Jefferies was expected to earn $0.88 per share but only achieved $0.60, resulting in a surprise of -31.82% [13] - Over the past four quarters, Jefferies has beaten consensus EPS estimates twice [14] Market Reaction - An earnings beat or miss may not solely dictate stock movement, as other factors can influence investor sentiment [15] - The combination of a positive Earnings ESP and a favorable Zacks Rank typically increases the likelihood of a successful investment [16]

Core Insights - Todd Eagle, a prominent real estate banker at Goldman Sachs, has left the firm to join Jefferies as the US head of real estate banking [1][2] - Eagle's departure marks a significant shift in the real estate banking landscape, as he has been a key figure at Goldman Sachs for over three decades [3][5] Company Transition - Eagle's name has been removed from Goldman Sachs' internal staff directory, indicating his official exit from the firm [1] - He will report to Michael Bluhm at Jefferies, who oversees global real estate, gaming, and lodging [2] Career Background - Todd Eagle has a long history with Goldman Sachs, having first joined as an analyst in 1990 and later becoming a managing director [3][5] - He has previously left Goldman twice, once for business school and again to focus on real estate investments, before returning to the firm [5] - Eagle has extensive experience advising on mergers, acquisitions, and financing opportunities in the real estate sector, particularly during his time in London [6]

Jefferies Financial Group Inc.已启动招聘十几名交易员的流程，以把握华尔街资产管理领域的一项悄然转 变：买方交易员职能的外包趋势。这家总部位于纽约的金融机构已为该计划新招募了九名交易员，并计 划再招聘八人。借助新增人手，Jefferies计划在现有股票交易部门的基础上，拓展固定收益产品外包交 易服务。该公司只是众多争夺外包交易市场份额的华尔街机构之一。瑞银集团今年早些时候意外退出该 业务，为市场注入了新的动力。（彭博） ...