Published on 25 Apr 2024 on Zacks via Yahoo Finance

Raymond James' (RJF) Q2 Earnings Miss, Revenues Rise Y/Y

Raymond James’ RJF second-quarter fiscal 2024 (ended Mar 31) adjusted earnings of $2.31 per share missed the Zacks Consensus Estimate by a penny. The bottom line, however, was up 14% from the prior-year quarter.Results were adversely impacted by higher non-interest expenses. Also, RJF recorded bank loan provision for credit losses during the quarter on the tough macroeconomic outlook.However, robust investment banking and brokerage performance aided the Capital Markets segment’s results. The performance of the Private Client Group and the Asset Management segments was also decent. The acquisitions over the past years supported the company’s financials to some extent.Net income available to common shareholders (GAAP basis) was $474 million or $2.22 per share, up from $425 million or $1.93 per share in the prior-year quarter.

Revenues Improve, Costs Rise

Net revenues were $3.12 billion, up 9% year over year. The top line matched the Zacks Consensus Estimate.Segment-wise, in the reported quarter, the Private Client Group recorded 9% growth in net revenues, Asset Management’s net revenues rose 17%, and Capital Markets’ top line increased 6%. Further, Others witnessed a 70% jump in revenues. Bank registered a fall of 21% from the prior year in net revenues.Non-interest expenses rose 8% year over year to $2.51 billion. The increase was largely due to higher compensation, commissions and benefits costs and investment sub-advisory fees. Our estimate for non-interest expenses was also $2.44 billion. Also, RJF recorded a bank loan provision for credit losses of $21 million.As of Mar 31, 2024, client assets under administration were $1.45 trillion, up 18% from the end of the prior-year quarter. Financial assets under management of $226.8 billion grew 17%. Our estimates for client assets under administration and financial assets under management were $1.32 trillion and $206.2 billion, respectively.