Evercore Earnings: Strong Results Reinforce Medium-Term Trajectory

Narrow-moat-rated Evercore reported strong second-quarter results that reinforce the thesis of rising merger activity and earnings for the company over the medium term. The company reported net income to common shareholders of $74 million, or $1.81 per diluted share, on $689 million of net revenue. Net revenue increased 38% from the previous year and 19% sequentially, with about all of the increase from the company's financial advisory business. We're likely to moderately increase our forecast for the company's 2024 revenue, but we don't anticipate it will lead to a significant increase in our $177 fair value estimate. While we rated the company's shares as undervalued for much of the previous 1.5 years, we now believe shares are moderately overvalued after their recent runup.