Core Viewpoint - Stifel Financial's shares are rated as a Buy due to a favorable outlook and undemanding valuations, with the market valuing the company at a low-teens P/E ratio despite strong Q2 results and positive guidance for the full year [1][9]. Financial Performance - Stifel Financial reported Q2 2024 financial results on July 24, with a top line growth of +15.9% YoY and +4.7% QoQ, reaching $1,217.9 million, surpassing Wall Street's consensus forecast by +2.5% [3]. - Non-GAAP adjusted EPS for Q2 2024 increased by +33.3% YoY to $1.60, beating market expectations by +4.0% [3]. - Fixed income transactional revenue grew by +20% QoQ and +58% YoY to $107 million, driven by increased trading gains [3]. - Investment banking advisory revenue reached $131 million, reflecting YoY and QoQ growth rates of +50% and +10%, respectively [4]. 2024 Guidance - Stifel Financial expects a top line increase of +8.7% to $4,725 million for FY 2024, indicating a turnaround from previous declines in net revenues [6]. - The company anticipates stable compensation expenses and a decrease in non-compensation operating expenses-to-revenue ratio from 23.2% in FY 2023 to 20.0% in FY 2024 [6]. Valuation Metrics - Stifel Financial currently trades at a normalized P/E of 12 times, with an expected EPS CAGR of +23% from FY 2023 to FY 2026, resulting in a PEG ratio of approximately 0.52, indicating attractive valuations [7].

Financial Data and Key Metrics - Q2 2024 net revenue totaled $1.22 billion, up 16% YoY, marking the second-best quarter in the company's history [68] - EPS in Q2 was $1.60, a 33% increase from the prior year, driven by higher revenues and a lower share count [28][29] - Investment Banking revenue increased 40%, with advisory revenue up 50% and capital raising growth of 29% [28] - Net interest income (NII) declined by $40 million or 14% in Q2, but within guidance [28][75] - Pretax margin for Q2 was 21%, with an annualized return on tangible common equity of 22% [28] - Record first-half net revenue of nearly $2.4 billion, up 10% YoY [28] Business Line Performance - Global Wealth Management revenue reached a record $801 million, with pretax margins exceeding 37% [53] - Institutional Group revenue was $391 million in Q2, up 41% YoY, driven by strong capital raising and transactional revenue [54] - Fixed income transactional revenue increased 58% YoY to $107 million, benefiting from improved trading gains [55] - Equity transactional revenue totaled $53 million, up 16% QoQ, supported by electronic offerings and high-touch trading [26] - Advisory revenue was $131 million, the strongest quarter since Q1 2023, with solid results in financials, gaming, and industrials [26] Market and Segment Performance - The company added 42 new advisers in Q2, including 14 experienced advisers with trailing 12-month production of $12.2 million [53] - Fee-based assets reached a record $180 billion, while total client assets stood at $474 billion, driven by higher equity markets and organic growth [53] - The company ranked 1 in the J D Power US Financial Advisor Satisfaction Study, particularly in leadership, culture, and operational support [51] Strategic Direction and Industry Competition - The company is focused on providing competitive products to grow client assets and retain advisers, emphasizing the importance of competitive offerings [4][41] - Stifel has been proactive in addressing cash sorting trends, with 63% of pre-rate cycle sweep deposits moving into higher-yielding Smart Rate accounts [57] - The company is optimistic about the second half of 2024, expecting continued improvement in Wealth Management and Institutional revenue [38][80] Management Commentary on Operating Environment and Outlook - Management highlighted the company's preparedness for the rate cycle, with no material impact expected on NII guidance for the remainder of 2024 [36] - The company is confident in its ability to manage cash sorting and sweep deposit dynamics, with operational cash balances averaging $9,000 per account [39][77] - Management expressed optimism about the future, citing strong operating leverage and a diversified business model [81] Other Important Information - The company retired $500 million in Senior Notes, reducing long-term liabilities and eliminating $21 million in annual interest expense [48][69] - Share repurchases in Q2 were 229,000 shares, down significantly from the prior quarter, with 11 million shares remaining under the authorization [79] - The company incurred $10 million in severance costs related to efficiency initiatives in international operations [58] Q&A Session Summary Question: Impact of cash sorting on sweep deposits and competitive dynamics [82] - Management clarified that operational cash balances are low due to the rate environment, with similar metrics between brokerage and advisory accounts [83] - The company is confident in its competitive positioning, offering up to 2% on sweep deposits, which is already higher than some peers [117] Question: Capital priorities and buyback pace [104] - The company has $415 million in excess capital and plans to be opportunistic with buybacks, focusing on price-dependent decisions [128] Question: Loan growth and balance sheet expansion [110] - Management noted that loan growth is constrained by deposit relationships and the need for a clear economic environment, but opportunities for growth remain [160][161] Question: Regulatory aspects of sweep deposits and fiduciary obligations [99] - Management emphasized that operational cash allocations are reasonable and well-understood, with no regulatory concerns [123] Question: Outlook for FIC trading and market conditions [140] - Management expects continued improvement in FIC trading, particularly in rate trading, as banks reposition their portfolios [162] Question: Recruiting environment and competitive dynamics [147] - Management sees potential opportunities in the recruiting environment, particularly as cash dynamics may pressure competitors with aggressive pricing [147]

■ Record Client Assets Under Administration Institutional Group INSTITUTIONAL GROUP REVENUE millions 2Q24 Y/Y Change Sequential Change 2024 YTD VS 2023 YTD Advisory $131 50% 10% $251 5% Capital Raising $96 28% 6% $187 42% Equity $48 59% 19% $88 61% Fixed Income $48 8% -4% $98 28% Transactional $160 41% 12% $302 28% Equity $53 16% -2% $107 9% Fixed Income $107 58% 20% $195 41% Total Institutional Revenue* $391 41% 11% $742 22% Comp. Ratio 61.2% -880 bps -20 bps 61.3% -430 bps Non-Comp. Ratio 26.3% -790 bps - ...

Institutional Group - Summary Results of Operations Stifel Bancorp - Financial Information and Credit Metrics Stifel Bancorp - Loan and Investment Portfolio Stifel Financial Corp. Quarterly Financial Supplement | Second Quarter 2024 Earnings Release Page 13 of 19 Stifel Financial Corp. Quarterly Financial Supplement | Second Quarter 2024 Earnings Release Page 14 of 19 Stifel Financial Corp. Quarterly Financial Supplement | Second Quarter 2024 Earnings Release Page 15 of 19 | --- | --- | --- | --- | --- | -- ...

ST. LOUIS, July 18, 2024 (GLOBE NEWSWIRE) -- Stifel Financial Corp. (NYSE:SF) will release its second quarter 2024 financial results before the market opens on Wednesday, July 24, 2024. The company will host a conference call to review the results at 9:30 a.m. Eastern time that same day. The conference call may include forward-looking statements. Stifel Company Information Stifel Investor Relations Contact Joel Jeffrey, Senior Vice President (212) 271-3610 direct investorrelations@stifel.com All interested ...

ST. LOUIS, July 10, 2024 (GLOBE NEWSWIRE) -- Stifel Financial Corp. (NYSE: SF) today announced that its Stifel, Nicolaus & Company, Incorporated broker-dealer subsidiary ranked No. 1 in the employee advisor segment of the J.D. Power 2024 U.S. Financial Advisor Satisfaction StudySM for the second straight year. Stifel's overall score, calculated from responses submitted by Stifel financial advisors, was 767 out of 1,000 – a significant 130 points higher than the employee segment average of 637. In addition t ...

ST. LOUIS, July 10, 2024 (GLOBE NEWSWIRE) -- Stifel Financial Corp. (NYSE: SF) today announced that its Stifel, Nicolaus & Company, Incorporated broker-dealer subsidiary ranked No. 1 in the employee advisor segment of the J.D. Power 2024 U.S. Financial Advisor Satisfaction StudySM for the second straight year. "I am thrilled that J.D. Power has once again named Stifel the No. 1 wealth management firm for employee advisor satisfaction," said Ron Kruszewski, Chairman and CEO of Stifel. "Earning this honor for ...

Mr. Boostrom concluded, "One of the smartest things we can do as leaders of financial firms is to listen to our advisor partners and create environments for them to feel valued and heard. This approach fosters the creativity that can ultimately generate great ideas like WON and our recent event." Women Owners' Network event brought together women from across the network, including several from newly affiliated firms with nearly $1 billion in client assets WON was spontaneously launched as the latest offshoo ...

ST. LOUIS, June 27, 2024 (GLOBE NEWSWIRE) -- Stifel Financial Corp. (NYSE: SF) today reported selected operating results for May 31, 2024 in an effort to provide timely information to investors on certain key performance metrics. Due to the limited nature of this data, a consistent correlation to earnings should not be assumed. Stifel Financial Corp. (NYSE: SF) is a financial services holding company headquartered in St. Louis, Missouri, that conducts its banking, securities, and financial services business ...

Ronald J. Kruszewski, Chairman and Chief Executive Officer, said, "Recruiting and market appreciation drove a 3% increase in total client and fee-based assets during the month. Cash sorting slowed as client money market and insured product levels were essentially flat. Modest growth in Smart Rate balances essentially offset declines in Sweep balances. We continue to see improvement in the environment for investment banking activity, but the timing of closings for M&A transactions remains difficult to foreca ...