Stifel Earnings: Positive Trends in the First Quarter Continued in the Subsequent Quarter

Stifel Financial reported its second-highest quarterly revenue and record client assets in the second quarter of 2024, as the positive trends exhibited in the first quarter continued in the most recent quarter. The company reported net income to common shareholders of $156 million, or $1.41 per diluted share, on $1.2 billion of net revenue. Net revenue increased 15.9% from the previous year and 4.7% sequentially, due to a recovery in institutional trading and investment banking revenue along with steady growth in asset management revenue. About the only detractor from revenue growth was a 14% decline from the previous year and 1% sequential decline in net interest income. While the US economy is slowing, it's still growing and most economists believe that the US will avoid a recession in the near term, so capital markets activity and asset prices should be supported. With trends largely developing as we anticipated, we are maintaining our $86 fair value estimate for narrow-moat-rated Stifel Financial and assess shares are fairly valued.