Looking back on investment banking & brokerage stocks’ Q2 earnings, we examine this quarter’s best and worst performers, including Raymond James (NYSE: RJF) and its peers.
Investment banks and brokerages facilitate capital raises, mergers and acquisitions, and securities trading. The sector benefits from corporate activity during economic expansion, increased retail trading participation, and advisory opportunities in emerging sectors. Headwinds include economic cycle vulnerability affecting deal flow, compressed trading commissions due to electronic platforms, and regulatory capital requirements constraining certain higher-risk activities.
The 16 investment banking & brokerage stocks we track reported a very strong Q2. As a group, revenues beat analysts’ consensus estimates by 6.7%.
In light of this news, share prices of the companies have held steady. On average, they are relatively unchanged since the latest earnings results.
Raymond James (NYSE: RJF)
Founded in 1962 and headquartered in St. Petersburg, Florida, Raymond James Financial (NYSE: RJF) is a diversified financial services company that provides wealth management, investment banking, asset management, and banking services to individuals and institutions.
Raymond James reported revenues of $3.40 billion, up 5.3% year on year. This print was in line with analysts’ expectations, but overall, it was a slower quarter for the company with a significant miss of analysts’ EPS estimates.
Interestingly, the stock is up 2.8% since reporting and currently trades at $165.64.
Is now the time to buy Raymond James? Access our full analysis of the earnings results here, it’s free for active Edge members.
Best Q2: Evercore (NYSE: EVR)
Founded in 1995 as a boutique advisory firm focused on independence and client trust, Evercore (NYSE: EVR) is an independent investment banking firm that provides strategic advisory, capital markets, and wealth management services to corporations, financial sponsors, and high-net-worth individuals.
Evercore reported revenues of $838.9 million, up 20.7% year on year, outperforming analysts’ expectations by 16.7%. The business had an incredible quarter with a beat of analysts’ EPS estimates and an impressive beat of analysts’ revenue estimates.
The market seems happy with the results as the stock is up 7.3% since reporting. It currently trades at $324.15.
Is now the time to buy Evercore? Access our full analysis of the earnings results here, it’s free for active Edge members.
Weakest Q2: BGC (NASDAQ: BGC)
Tracing its roots back to 1945 and named after founder Bernard Gerald Cantor, BGC Group (NASDAQ: BGC) operates a global brokerage and financial technology platform that facilitates trading across fixed income, foreign exchange, equities, energy, and commodities markets.
BGC reported revenues of $750.2 million, up 41.8% year on year, falling short of analysts’ expectations by 2.3%. It was a slower quarter as it posted a miss of analysts’ revenue and EBITDA estimates.
BGC delivered the fastest revenue growth but had the weakest performance against analyst estimates in the group. As expected, the stock is down 4.8% since the results and currently trades at $9.25.
Read our full analysis of BGC’s results here.
Perella Weinberg (NASDAQ: PWP)
Founded in 2006 by veteran investment bankers Joseph Perella and Peter Weinberg during a wave of boutique advisory firm launches, Perella Weinberg Partners (NASDAQ: PWP) is a global independent advisory firm that provides strategic and financial advice to corporations, financial sponsors, and government institutions.
Perella Weinberg reported revenues of $155.3 million, down 42.9% year on year. This print surpassed analysts’ expectations by 12.9%. Overall, it was an incredible quarter as it also recorded a beat of analysts’ EPS and revenue estimates.
Perella Weinberg had the slowest revenue growth among its peers. The stock is flat since reporting and currently trades at $19.83.
Read our full, actionable report on Perella Weinberg here, it’s free for active Edge members.
PJT (NYSE: PJT)
Spun off from Blackstone in 2015 and founded by former Morgan Stanley executive Paul J. Taubman, PJT Partners (NYSE: PJT) is an advisory-focused investment bank that provides strategic advice, restructuring services, and fundraising solutions to corporations, boards, and investment firms.
PJT reported revenues of $406.9 million, up 13% year on year. This number beat analysts’ expectations by 4.8%. It was a very strong quarter as it also logged an impressive beat of analysts’ EBITDA and revenue estimates.
The stock is down 3.3% since reporting and currently trades at $176.55.
Read our full, actionable report on PJT here, it’s free for active Edge members.
Market Update
As a result of the Fed’s rate hikes in 2022 and 2023, inflation has come down from frothy levels post-pandemic. The general rise in the price of goods and services is trending towards the Fed’s 2% goal as of late, which is good news. The higher rates that fought inflation also didn't slow economic activity enough to catalyze a recession. So far, soft landing. This, combined with recent rate cuts (half a percent in September 2024 and a quarter percent in November 2024) have led to strong stock market performance in 2024. The icing on the cake for 2024 returns was Donald Trump’s victory in the U.S. Presidential Election in early November, sending major indices to all-time highs in the week following the election. Still, debates around the health of the economy and the impact of potential tariffs and corporate tax cuts remain, leaving much uncertainty around 2025.
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