Raymond James Financial, Inc. (RJF) is well poised to benefit from resurgence in deal-making activities, strategic acquisitions and interest rate cuts. Further, sustainable capital distributions on the back of a solid balance sheet and capital position are another positive.The Zacks Consensus Estimate for Raymond James’ fiscal 2025 and fiscal 2026 has been revised marginally upward over the past month. The positive estimate revision indicates that analysts are optimistic regarding the company’s prospects an ...

Raymond James (RJF) has announced enhanced capital distribution plans, including a dividend hike and a new share buyback program. RJF's board of directors has declared a quarterly cash dividend of 50 cents per share, representing an increase of 11.1% from the prior payout. The new dividend will be paid out on Jan. 16, 2025, to shareholders on record as of Jan. 2, 2025.Raymond James has a record of regularly raising dividends over the last decade. Before the recent hike, the company announced a 7.1% increase ...

ST. PETERSBURG, Fla., Dec. 03, 2024 (GLOBE NEWSWIRE) -- On December 3, 2024, the Raymond James Financial, Inc. (NYSE: RJF) Board of Directors declared a quarterly cash dividend on shares of its common stock of $0.50 per share, payable January 16, 2025 to shareholders of record on January 2, 2025. This is an 11.1% increase over the previous dividend of $0.45 per share paid on October 15, 2024. The Board declared a quarterly dividend of $0.3984375 per depositary share of 6.375% Fixed-to-Floating Rate Series B ...

分组1 - The third-quarter earnings season showed a total earnings increase of 8.1% on 5.5% higher sales, surpassing estimates of 3.3% growth [1] - Fourth-quarter earnings are projected to grow by 7.7% with a 4.9% increase in revenue according to Zacks estimates [1] - The S&P 500 and Nasdaq are trading near all-time highs, indicating a bullish market outlook for December and January [2] 分组2 - A screening method is introduced to identify stocks with strong upward earnings revisions and price momentum, focusing on Zacks Rank 1 (Strong Buy) stocks [3][5] - The screening criteria include stocks trading within 20% of their 52-week highs, a PEG ratio of less than or equal to 1, and a Price/Sales ratio of less than or equal to 3 [7] - The screening process has narrowed down to seven stock picks, including Raymond James Financial, which is highlighted as a strong buy [6][11] 分组3 - Raymond James Financial's Private Client Group segment contributed 66% of net revenues in fiscal 2024, with a compound annual growth rate of 12.7% over the last three fiscal years [8] - The company exceeded Q4 FY24 earnings estimates, leading to a Zacks Rank 1 (Strong Buy) rating [9] - RJF is projected to grow adjusted EPS by 8% in FY25 and 6% in FY26, with sales growth of 10% and 6% respectively [10] 分组4 - RJF stock has increased by 60% over the past 12 months, significantly outperforming the Zacks Finance sector and the S&P 500 [10] - Despite strong performance, RJF trades at a 14% discount with a forward P/E of 15.3X, and offers a 1.1% dividend yield [11]

Regulatory Compliance and Capital Requirements - Raymond James Bank and TriState Capital Bank are categorized as well-capitalized as of September 30, 2024[96] - The FDIC's deposit insurance covers up to $250,000 per account ownership type for Raymond James Bank and TriState Capital Bank[92] - RJF is subject to the Volcker Rule, which prohibits proprietary trading but allows underwriting, market-making, and risk-mitigating hedging activities[97] - Raymond James Bank and TriState Capital Bank are subject to the Community Reinvestment Act (CRA), which requires lending to low- and moderate-income communities[99] - The SEC's Regulation Best Interest requires broker-dealers to act in the best interest of retail clients when recommending securities transactions or investment strategies[109] - The U.K. Consumer Duty, effective July 31, 2023, requires firms to deliver "good outcomes" for retail customers in areas such as products, price, and consumer support[110] - The Department of Labor (DOL) issued a final rule in April 2024 expanding the definition of "investment advice fiduciary," which may impose additional compliance costs if enacted[111] - RJF's U.S. broker-dealer subsidiaries are required to maintain minimum net capital to meet customer commitments and are limited in transferring capital to parent companies[108] - The FDIC's assessment rate for banks with over $10 billion in assets, including Raymond James Bank and TriState Capital Bank, is based on a scorecard method evaluating financial performance and stress resilience[92] - Failure to meet capital requirements could result in constraints on distributions, including limitations on dividend payments and stock repurchases for RJF, Raymond James Bank, and TriState Capital Bank[86] - Raymond James Ltd. in Canada provides investor protection up to 1 million CAD per client, with additional coverage of 1 million CAD for certain accounts[114] - U.K. subsidiaries are regulated by the FCA and benefit from the Financial Ombudsman Service and the Financial Services Compensation Scheme[115] - Raymond James Corporate Finance GmbH in Germany is licensed by BaFin and must comply with capital, liquidity, governance, and business conduct requirements[116] - U.S. investment advisory operations are regulated under the Investment Advisers Act of 1940, with asset managers registered with the SEC[117] - The U.S. Bank Secrecy Act mandates client identification verification and monitoring of transactions to combat money laundering and terrorism[118] - The U.S. Treasury's Office of Foreign Assets Control enforces economic and trade sanctions programs[119] - The California Privacy Rights Act (CPRA) became enforceable in 2023, requiring additional disclosures and data subject rights for California residents[125] - The E.U. and U.K. GDPR imposes strict data protection compliance requirements for companies processing personal data of E.U. and U.K. residents[126] - SEC amendments to Regulation S-P require broker-dealers to notify individuals of unauthorized access to sensitive customer information within 30 days, effective December 21, 2025[127] - The E.U. Artificial Intelligence Act poses challenges for transparency, fairness, and accountability in AI use[128] Credit Risk and Allowance for Credit Losses - The company's allowance for credit losses on loans was $457 million as of September 30, 2024, with a portion related to the Raymond James Bank allowance for credit losses (ACL) on C&I and CRE portfolio segments[567] - The collective ACL is estimated using a current expected credit losses methodology based on historical losses, current conditions, and economic forecasts[567] - The company uses third-party historical information combined with macroeconomic variables to estimate probability of default (PD) and loss given default (LGD)[569] - For the C&I portfolio segment, the company reverts to historical loss information over a one-year period using a straight-line reversion approach after the forecast period[569] - For the CRE portfolio segment, the company incorporates a forecast of macroeconomic variables over the remaining life of the assets[569] - The assessment of the September 30, 2024 collective ACL on Raymond James Bank loans related to the C&I and CRE portfolio segments was identified as a critical audit matter[570] - The audit involved evaluating the collective ACL methodology, including the methods and models used to estimate PDs and LGDs, and their significant assumptions[570] - The audit also included evaluating the qualitative factors by portfolio segment and the conceptual soundness and performance of the PD and LGD models[570] - Credit risk professionals assisted in evaluating the company's collective ACL methodology for compliance with U.S. GAAP and assessing the conceptual soundness of the models[572] - The sufficiency of the audit evidence was assessed by evaluating the cumulative results of the audit procedures and the qualitative aspects of the company's accounting practices[574] - The allowance for credit losses (ACL) is estimated using multiple methodologies, considering factors like economic conditions and collateral value[663][665] - Credit losses are charged off against the allowance, with recoveries credited back, and adjustments made in earnings each reporting period[666] - The allowance for credit losses on loans is estimated using credit risk models incorporating macroeconomic indicators like GDP and unemployment rates[667] - Loans are evaluated collectively or individually based on risk characteristics, with allowances comprising quantitative and qualitative components[668][669] - The allowance for credit losses on unfunded lending commitments is estimated based on expected funding probabilities and portfolio mix[675] - Loans to financial advisors are evaluated using credit risk models, considering factors like affiliation status and repayment ability[676] - Available-for-sale securities are assessed for credit losses quarterly, with zero credit losses expected for U.S. government-backed securities[677][678] Financial Performance and Metrics - Total assets increased to $82,992 million in September 2024 from $78,360 million in September 2023, reflecting a growth of 5.9%[576] - Net income for the year ended September 2024 was $2,068 million, up 18.9% from $1,739 million in 2023[577] - Total revenues for the year ended September 2024 reached $14,923 million, a 14.9% increase from $12,992 million in 2023[577] - Interest income grew to $4,232 million in 2024, a 12.9% increase from $3,748 million in 2023[577] - Compensation, commissions, and benefits expenses rose to $8,213 million in 2024, up 12.5% from $7,299 million in 2023[577] - Earnings per common share (diluted) increased to $9.70 in 2024 from $7.97 in 2023, reflecting a 21.7% growth[577] - Bank deposits increased to $56,010 million in September 2024, up 3.3% from $54,199 million in September 2023[576] - Total other comprehensive income for 2024 was $469 million, a significant improvement from $11 million in 2023[577] - Retained earnings grew to $11,894 million in September 2024, up 16.5% from $10,213 million in September 2023[576] - Net income attributable to Raymond James Financial, Inc. increased to $2,068 million in 2024, up from $1,739 million in 2023 and $1,509 million in 2022[578] - Total equity attributable to Raymond James Financial, Inc. rose to $11,673 million in 2024, compared to $10,214 million in 2023 and $9,458 million in 2022[578] - Net cash provided by operating activities was $2,155 million in 2024, a significant improvement from a net cash used in operating activities of $3,514 million in 2023[579] - Increase in bank deposits reached $1,811 million in 2024, down from $2,842 million in 2023 but up from $6,269 million in 2022[579] - Repurchases of common stock and share-based awards totaled $984 million in 2024, compared to $862 million in 2023 and $216 million in 2022[579] - Dividends on common and preferred stock amounted to $383 million in 2024, slightly higher than $355 million in 2023 and $277 million in 2022[579] - Proceeds from FHLB advances were $1,300 million in 2024, down from $3,200 million in 2023 but up from $1,025 million in 2022[579] - Repayments of FHLB advances and other borrowed funds totaled $1,350 million in 2024, compared to $3,391 million in 2023 and $967 million in 2022[579] - Net cash used in investing activities was $968 million in 2024, higher than $274 million in 2023 but lower than $7,151 million in 2022[579] - Net cash provided by financing activities was $438 million in 2024, down from $1,438 million in 2023 and $5,879 million in 2022[579] - Net increase in cash and cash equivalents for the year ended September 2024 was $1.8 billion, compared to a decrease of $2.111 billion in 2023 and a decrease of $1.79 billion in 2022[580] - Cash and cash equivalents, including those segregated for regulatory purposes and restricted cash, stood at $14.348 billion at the end of September 2024, up from $12.548 billion in 2023 and $14.659 billion in 2022[580] - Cash paid for interest in 2024 was $2.119 billion, a significant increase from $1.31 billion in 2023 and $323 million in 2022[580] Revenue Recognition and Financial Instruments - Asset management and related administrative fees are recognized monthly based on the value of client assets, which are impacted by market fluctuations and net inflows or outflows[590] - Brokerage revenues include upfront commissions and trailing commissions, with trailing commissions recognized when it is probable that a significant reversal will not occur[594] - Principal transactions revenues include gains and losses on inventories of fixed income products, equity securities, and derivatives[596] - Investment banking revenues are recognized based on the amount of the transaction and the role in the transaction, with underwriting revenues recognized on trade date[599] - Cash equivalents include money market funds or highly liquid investments with maturities of three months or less[600] - Assets segregated for regulatory purposes and restricted cash include cash, cash equivalents, and highly liquid securities such as U.S. Treasuries[603] - Reverse repurchase agreements and repurchase agreements are accounted for as collateralized agreements and financings, respectively, with collateral values evaluated daily to ensure market value sufficiency[605] - Securities borrowed transactions require cash deposits generally in excess of the market value of securities borrowed, while securities loaned transactions receive cash in excess of the market value of securities loaned[606] - Financial instruments are classified into three levels based on fair value hierarchy: Level 1 (highly liquid instruments), Level 2 (observable inputs), and Level 3 (unobservable inputs requiring significant judgment)[610][611] - Trading assets and liabilities are recorded at fair value, with Level 1 instruments valued using quoted prices in active markets[616] - Available-for-sale securities, primarily agency MBS and U.S. Treasuries, are classified within Level 2 of the fair value hierarchy, with fair values determined using third-party pricing services[621] - Derivative assets and liabilities are recorded at fair value, with netting by counterparty allowed under master netting agreements to reduce credit exposure[623] - Interest rate derivatives are classified within Level 2 of the fair value hierarchy, with fair values obtained from internal or third-party pricing models[626] - Foreign-exchange derivatives, primarily forward contracts, are classified within Level 2 of the fair value hierarchy, with fair values determined using third-party pricing services[629] - Private equity investments are measured at fair value, with the majority utilizing the NAV of the fund as a practical expedient and the remainder using Level 3 valuation techniques[632] - Fractional shares held by clients are included in "Other assets" and recorded at fair value based on quoted prices in active markets, classified within Level 1 of the fair value hierarchy[633] - Brokerage client receivables are reported at their outstanding principal balance, net of any allowance for credit losses, and are generally collateralized by securities owned by clients[634] - Other receivables, net, primarily include receivables from brokers, dealers, and clearing organizations, with minimal credit risk due to the low probability of clearing organization default[635] - Bank loans held for investment are recorded at unpaid principal balance plus premiums or less discounts, net of deferred fees and costs, and include securities-based loans, commercial and industrial loans, and residential mortgage loans[637] - Residential mortgage loans held for sale are carried at the lower of cost or estimated fair value, with fair values estimated using observable prices from counterparties for similar loans[641] - Small Business Administration (SBA) loans are accounted for at the lower of cost or estimated fair value, with fair values determined based on committed sales price, third-party price quotes, or third-party pricing services[642] - Corporate loans, including commercial and industrial loans, are designated as held for investment upon inception and recorded in loans receivable, with fair value estimates based on collateral value less selling costs or discounted cash flows[644] - Unfunded lending commitments are secured by collateral such as marketable securities, accounts receivable, inventory, and real estate, with the allowance for potential credit losses included in "Other payables"[645][648] - Loan modifications to borrowers experiencing financial difficulty may involve principal forgiveness, interest rate reduction, payment delay, or term extension, and are subject to nonaccrual policies[650] - Nonperforming assets include nonperforming loans and other real estate owned, with loans placed on nonaccrual status when full payment of principal and interest is in doubt or the loan is past due 90 days or more[652] - Loans to financial advisors are considered past due after 30 days of delinquency and placed on nonaccrual status if full payment is in doubt or 180 days delinquent[661] - The company evaluates loans for potential write-downs when full collection is unlikely, with charge-offs taken against the allowance for credit losses[662] Asset Management and Valuation - Goodwill is evaluated for impairment annually or when events indicate potential impairment, using qualitative or quantitative assessments[683][684] - Company-owned life insurance policies are recorded at cash surrender value as determined by the insurer, used to fund non-qualified deferred compensation plans and other employee benefit plans[689] - Investments in Low-Income Housing Tax Credit (LIHTC) funds and similar structures are consolidated and included in "Other assets" on the Consolidated Statements of Financial Condition[691] - The Bank segment holds tax-beneficial investments, including LIHTC funds managed by RJAHI, also included in "Other assets"[692] - Property and equipment are depreciated using the straight-line method over estimated useful lives: buildings (15-40 years), furniture (3-10 years), software (2-10 years), and leasehold improvements (lesser of useful life or lease term)[693] - Internally developed software costs are capitalized when they result in additional functionality, while preliminary and post-project activities are expensed as incurred[693] - Lease liabilities are recorded at the present value of lease payments, discounted using the incremental borrowing rate or imputed lease rate[697] - Bank deposits include money market accounts, savings accounts, and certificates of deposit, with interest rates primarily determined by market rates[698] - Contingent liabilities are recognized when a loss is probable and reasonably estimable, with the most likely amount within the range accrued[699] - Legal and regulatory liabilities are recorded in "Other payables" and adjusted periodically based on management's judgment[700]

Core Viewpoint - Raymond James Financial, Inc. has shown strong performance in its recent earnings report, with adjusted earnings significantly surpassing estimates and a positive trend in share price, outperforming the S&P 500 [1][2][15]. Financial Performance - For Q4 fiscal 2024, adjusted earnings were $2.95 per share, exceeding the Zacks Consensus Estimate of $2.44, and reflecting a 38% increase from the prior-year quarter [2][3]. - The net income available to common shareholders on a GAAP basis was $601 million or $2.86 per share, up from $432 million or $2.02 per share in the prior-year quarter [3]. - For fiscal 2024, adjusted earnings reached $10.05, beating the consensus estimate of $9.55, and grew 21% year over year [4]. Revenue and Expenses - Quarterly net revenues were $3.46 billion, a 13% increase year over year, surpassing the Zacks Consensus Estimate of $3.3 billion [5]. - For fiscal 2024, net revenues grew 10% year over year to $12.82 billion, exceeding the consensus estimate of $12.67 billion [5]. - Non-interest expenses rose 9% from the prior-year quarter to $2.7 billion, primarily due to higher compensation and investment sub-advisory fees [7]. Segment Performance - The Private Client Group saw a 9% growth in net revenues, Asset Management's net revenues increased by 17%, and Capital Markets' top line surged by 42% [6]. - The Bank segment experienced a decline of 4% in net revenues compared to the prior year [6]. Client Assets and Balance Sheet - As of September 30, 2024, client assets under administration reached $1.57 trillion, a 25% increase from the prior-year quarter [8]. - Total assets were $83 billion, up 3% from the prior quarter, and total equity rose 4% to $11.59 billion [9]. Capital Ratios and Share Repurchases - The book value per share increased to $57.03 from $48.54 a year ago, with a total capital ratio of 24.1% compared to 22.8% a year prior [10]. - In the reported quarter, the company repurchased 2.6 million shares for $300 million [11]. Market Outlook - Estimates for Raymond James Financial have trended upward, with a consensus estimate shift of 6.95% [12][13]. - The company holds a Zacks Rank 1 (Strong Buy), indicating expectations for above-average returns in the coming months [15].

Core Viewpoint - Raymond James (RJF) shares have reached an all-time high, driven by a revival in the investment banking sector and favorable macroeconomic conditions [1][2][14]. Group 1: Stock Performance - RJF shares hit a record high of $164.33, increasing by 11.6% since the U.S. presidential election on November 5 [1]. - Over the past three months, RJF stock has surged 41.4%, outperforming both the industry and the S&P 500 Index, as well as its peers Morgan Stanley (MS) and Evercore (EVR) [1]. Group 2: Investment Banking Recovery - The optimism surrounding Raymond James is primarily due to the recovery of the investment banking (IB) business after a prolonged downturn [2]. - The Federal Reserve has initiated interest rate cuts, with a 50 basis point reduction in September and a subsequent 25 basis point cut on November 7, which is expected to enhance deal-making activities [3]. - The incoming administration is anticipated to be more favorable towards corporate mergers and acquisitions, further benefiting Raymond James' IB performance [4]. Group 3: Financial Performance - RJF's IB fees experienced a decline of 4% in fiscal 2022 and 41% in fiscal 2023, but there has been a turnaround with a 7% increase in fiscal 2024 [5][6]. - The company has a robust pipeline and an active M&A market, indicating a solid improvement in IB fees in the near future [6]. Group 4: Strategic Acquisitions - Raymond James has made several strategic acquisitions, including Solus Trust Company Limited in fiscal 2023 and others in previous years, which have expanded its presence in Europe and Canada [7][8]. - The company aims to continue growing through acquisitions to strengthen its Private Client Group and Asset Management segments [8]. Group 5: Capital Distributions - RJF has a history of increasing dividends, with a recent hike of 7.1% announced in November 2023, and a total payout growth of 18.06% over the past five years [9]. - The company authorized a share repurchase program worth up to $1.5 billion, with $645 million remaining as of September 30, 2024 [10]. Group 6: Analyst Sentiment - Analysts have revised upward their earnings estimates for RJF, projecting earnings of $10.83 and $11.53 per share for fiscal 2025 and 2026, respectively [11][12]. - The projected growth rates are 7.8% for fiscal 2025 and 6.5% for fiscal 2026 [12]. Group 7: Conclusion - The revival of the IB business, strategic growth initiatives, and a strong balance sheet position Raymond James favorably for future performance [14]. - Given the positive analyst outlook and macroeconomic conditions, RJF stock is considered a strong investment opportunity [15][16].

Group 1 - The stock market experienced a significant positive shift, particularly benefiting brokerage firms like Charles Schwab and Raymond James Financial, with shares rising by 6.5% and 9.4% respectively [1][2] - The bullish environment for the banking sector is largely attributed to Donald Trump's successful presidential bid, which is expected to favor pro-business policies, positively impacting financial stocks [2][4] - Historical performance indicates that shares of Raymond James and Charles Schwab saw growth during Trump's previous presidency, supported by strong economic growth and a peak GDP growth rate of 4.8% in Q3-2019 [3][4] Group 2 - The current economic agenda appears to mirror Trump's previous policies, leading investors to connect the dots and anticipate similar outcomes for financial stocks [5] - Despite the positive market reaction, caution is advised as the surge in Raymond James shares may lead to profit-taking, especially since they are trading above analysts' consensus price target of around $146 [6][7] - Charles Schwab presents a compelling investment opportunity, as its shares, despite recent gains, remain below early-2022 highs, suggesting potential for further upside [8]

Group 1 - Momentum investing involves following a stock's recent trend, with the aim of buying high and selling higher, capitalizing on established price movements [1] - Raymond James Financial, Inc. (RJF) currently holds a Momentum Style Score of A, indicating strong momentum characteristics [2][3] - The Zacks Rank for RJF is 2 (Buy), suggesting that stocks rated 1 (Strong Buy) and 2 (Buy) with Style Scores of A or B tend to outperform the market in the following month [3] Group 2 - RJF shares have increased by 4.62% over the past week, while the Zacks Financial - Investment Bank industry has decreased by 1.23% during the same period [5] - Over the past quarter, RJF shares have risen by 38.17%, and by 56.14% over the last year, significantly outperforming the S&P 500, which moved 7.12% and 43.49% respectively [6] Group 3 - RJF's average 20-day trading volume is 1,435,897 shares, which serves as a bullish indicator when combined with rising stock prices [7] - In the past two months, 7 earnings estimates for RJF have been revised upwards, increasing the consensus estimate from $10.19 to $10.68 [9] - For the next fiscal year, 2 estimates have moved upwards while 1 has been revised downwards, indicating a generally positive earnings outlook [9]

Core Insights - The article compares Raymond James Financial, Inc. (RJF) and The Charles Schwab Corporation (SCHW) to determine which stock offers better value for investors [1] Valuation Metrics - RJF has a forward P/E ratio of 13.95, while SCHW has a forward P/E of 23.09, indicating that RJF may be undervalued compared to SCHW [5] - RJF's PEG ratio is 0.76, suggesting a more favorable valuation relative to its expected earnings growth, compared to SCHW's PEG ratio of 1.65 [5] - RJF's P/B ratio is 2.78, while SCHW's P/B ratio is 3.68, further supporting the notion that RJF is more attractively priced [6] Analyst Outlook - RJF has a Zacks Rank of 2 (Buy), indicating a more positive earnings estimate revision activity compared to SCHW's Zacks Rank of 3 (Hold), which suggests a less favorable outlook [3] Value Grades - RJF has been assigned a Value grade of B, while SCHW has a Value grade of C, indicating that RJF is perceived as a better value investment [6][7]