NYSE:RJF

Stock Analysis Report

Executive Summary

Raymond James Financial, Inc., through its subsidiaries, engages in the underwriting, distribution, trading, and brokerage of equity and debt securities, and the sale of mutual funds and other investment products in the United States, Canada, and Europe.

Rewards

Trading at 36.8% below its fair value

Earnings are forecast to grow 5.15% per year

Earnings grew by 20.6% over the past year

Pays a high and reliable dividend of 1.58%

Risk Analysis

High level of non-cash earnings



Snowflake Analysis

Undervalued established dividend payer.


Similar Companies

Lazard

NYSE:LAZ

Share Price & News

How has Raymond James Financial's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: RJF has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

3.7%

RJF

2.4%

US Capital Markets

2.0%

US Market


1 Year Return

18.5%

RJF

19.0%

US Capital Markets

23.6%

US Market

Return vs Industry: RJF matched the US Capital Markets industry which returned 18.8% over the past year.

Return vs Market: RJF underperformed the US Market which returned 24.7% over the past year.


Shareholder returns

RJFIndustryMarket
7 Day3.7%2.4%2.0%
30 Day5.7%3.8%3.9%
90 Day16.4%15.0%12.0%
1 Year20.5%18.5%21.4%19.0%26.2%23.6%
3 Year38.1%32.4%48.9%40.5%53.2%43.3%
5 Year96.2%83.0%96.0%77.8%75.7%56.3%

Price Volatility Vs. Market

How volatile is Raymond James Financial's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Raymond James Financial undervalued compared to its fair value and its price relative to the market?

35.1%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: RJF ($93.95) is trading below our estimate of fair value ($148.63)

Significantly Below Fair Value: RJF is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: RJF is good value based on its PE Ratio (12.8x) compared to the Capital Markets industry average (36.1x).

PE vs Market: RJF is good value based on its PE Ratio (12.8x) compared to the US market (18.9x).


Price to Earnings Growth Ratio

PEG Ratio: RJF is poor value based on its PEG Ratio (2.5x)


Price to Book Ratio

PB vs Industry: RJF is good value based on its PB Ratio (2x) compared to the US Capital Markets industry average (6.6x).


Next Steps

Future Growth

How is Raymond James Financial forecast to perform in the next 1 to 3 years based on estimates from 11 analysts?

5.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: RJF's forecast earnings growth (5.1% per year) is above the savings rate (1.7%).

Earnings vs Market: RJF's earnings (5.1% per year) are forecast to grow slower than the US market (14.3% per year).

High Growth Earnings: RJF's earnings are forecast to grow, but not significantly.

Revenue vs Market: RJF's revenue (5.5% per year) is forecast to grow slower than the US market (7.5% per year).

High Growth Revenue: RJF's revenue (5.5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: RJF's Return on Equity is forecast to be low in 3 years time (14.6%).


Next Steps

  • Explore growth companies in the Diversified Financials industry.

Past Performance

How has Raymond James Financial performed over the past 5 years?

18.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: RJF has a high level of non-cash earnings.

Growing Profit Margin: RJF's current net profit margins (13.4%) are higher than last year (11.8%).


Past Earnings Growth Analysis

Earnings Trend: RJF's earnings have grown by 18.2% per year over the past 5 years.

Accelerating Growth: RJF's earnings growth over the past year (20.6%) exceeds its 5-year average (18.2% per year).

Earnings vs Industry: RJF earnings growth over the past year (20.6%) exceeded the Capital Markets industry 18.2%.


Return on Equity

High ROE: RJF's Return on Equity (15.6%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Raymond James Financial's financial position? (This company is analysed differently as a bank or financial institution)


Financial Position Analysis


Debt to Equity History and Analysis


Balance Sheet

Inventory Level: RJF has a low level of unsold assets or inventory.

Debt Coverage by Assets: RJF's debt is covered by short term assets (assets are 10.2x debt).


Financial Institutions Analysis

Asset Level: RJF's level of assets compared to its equity is low.

Allowance for Bad Loans: Insufficient data to determine if RJF has a sufficient allowance for bad loans.

Low Risk Liabilities: RJF reports no customer deposits, loans are made up entirely of externally borrowed funds.

Loan Level: Insufficient data to determine if RJF has an acceptable proportion of non-loan assets held.

Low Risk Deposits: RJF has advanced significantly more loans than the customer deposits it holds.

Level of Bad Loans: Insufficient data to determine if RJF has an appropriate level of bad loans.


Next Steps

Dividend

What is Raymond James Financial's current dividend yield, its reliability and sustainability?

1.54%

Current Dividend Yield


Dividend Yield vs Market

company1.5%marketbottom25%1.4%markettop25%3.7%industryaverage1.8%forecastin3Years1.6%

Current dividend yield vs market & industry

Notable Dividend: RJF's dividend (1.58%) is higher than the bottom 25% of dividend payers in the US market (1.4%).

High Dividend: RJF's dividend (1.58%) is low compared to the top 25% of dividend payers in the US market (3.66%).


Stability and Growth of Payments

Stable Dividend: RJF's dividends per share have been stable in the past 10 years.

Growing Dividend: RJF's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its low payout ratio (18.6%), RJF's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: RJF's dividends in 3 years are forecast to be well covered by earnings (20.6% payout ratio).


Next Steps

Management

What is the CEO of Raymond James Financial's salary, the management and board of directors tenure and is there insider trading?

1.1yrs

Average management tenure


CEO

Paul Reilly (64yo)

9.7yrs

Tenure

US$11,123,643

Compensation

Mr. Paul Christopher Reilly serves as the Chief Executive Officer of Raymond James Financial Inc in May 2010, after joining the Company’s management team as President in May 2009 until April 2010. He has s ...


CEO Compensation Analysis

Compensation vs Market: Paul's total compensation ($USD11.12M) is about average for companies of similar size in the US market ($USD10.76M).

Compensation vs Earnings: Paul's compensation has been consistent with company performance over the past year.


Management Age and Tenure

1.1yrs

Average Tenure

62yo

Average Age

Experienced Management: RJF's management team is not considered experienced ( 1.3 years average tenure), which suggests a new team.


Board Age and Tenure

5.9yrs

Average Tenure

60yo

Average Age

Experienced Board: RJF's board of directors are considered experienced (5.9 years average tenure).


Insider Trading

Insider Buying: RJF insiders have only sold shares in the past 3 months.


Recent Insider Transactions

SellUS$1,053,11517 Dec 19
Paul Reilly
EntityIndividual
Role
Chief Executive Officer
Chairman & CEO
Shares11,621
Max PriceUS$90.62
SellUS$226,25016 Dec 19
Jennifer Ackart
EntityIndividual
Role
Chief Accounting Officer
Senior VP
Shares2,500
Max PriceUS$90.50
SellUS$181,74410 Dec 19
Jennifer Ackart
EntityIndividual
Role
Chief Accounting Officer
Senior VP
Shares2,000
Max PriceUS$90.87
SellUS$874,68709 Dec 19
Paul Allison
EntityIndividual
Role
Unit Chairman
Chairman
Shares9,628
Max PriceUS$90.85
SellUS$418,62929 Nov 19
Steven Raney
EntityIndividual
Shares4,701
Max PriceUS$89.05
SellUS$270,00029 Nov 19
Jennifer Ackart
EntityIndividual
Role
Chief Accounting Officer
Senior VP
Shares3,000
Max PriceUS$90.00
SellUS$489,61725 Nov 19
George Catanese
EntityIndividual
Shares5,510
Max PriceUS$88.86
SellUS$446,85022 Nov 19
John Carson
EntityIndividual
Role
President
President
Shares5,000
Max PriceUS$89.37
SellUS$41,58112 Nov 19
George Catanese
EntityIndividual
Shares464
Max PriceUS$89.61
SellUS$1,529,26807 Nov 19
Jeffrey Trocin
EntityIndividual
Shares17,360
Max PriceUS$88.09
SellUS$541,01129 Oct 19
James Bunn
EntityIndividual
Role
Head of Investment Banking
Co-President of Global Equities & Investment Banking
Shares6,395
Max PriceUS$84.60
SellUS$713,08016 Sep 19
Jeffrey Dowdle
EntityIndividual
Role
Co-Chief Operating Officer
COO & Head of Asset Management Group
Shares8,398
Max PriceUS$84.91
SellUS$101,75613 Sep 19
Jonathan Santelli
EntityIndividual
Shares1,200
Max PriceUS$84.80
SellUS$1,238,29630 Aug 19
Jeffrey Julien
EntityIndividual
Role
Senior Key Executive
Executive VP of Finance & Senior Adviser
Shares15,756
Max PriceUS$78.59
SellUS$452,28407 May 19
Paul Allison
EntityIndividual
Role
Unit Chairman
Chairman
Shares5,000
Max PriceUS$90.46
SellUS$1,198,71701 May 19
Jeffrey Trocin
EntityIndividual
Shares13,157
Max PriceUS$91.11
SellUS$2,554,28801 May 19
Jeffrey Julien
EntityIndividual
Role
Senior Key Executive
Executive VP of Finance & Senior Adviser
Shares28,073
Max PriceUS$91.43
SellUS$5,481,04830 Apr 19
Paul Reilly
EntityIndividual
Role
Chief Executive Officer
Chairman & CEO
Shares60,000
Max PriceUS$91.35

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Jeff Julien (63yo)

    Executive VP of Finance & Senior Adviser

    • Tenure: 0.08yrs
    • Compensation: US$3.54m
  • Dennis Zank (65yo)

    Financial Advisor of Local Branch

    • Tenure: 1.3yrs
    • Compensation: US$4.02m
  • Jen Ackart (55yo)

    Senior VP

    • Tenure: 0.8yrs
  • Paul Reilly (64yo)

    Chairman & CEO

    • Tenure: 9.7yrs
    • Compensation: US$11.12m
  • John Carson (62yo)

    President

    • Tenure: 7.8yrs
    • Compensation: US$3.48m
  • Thom Tremaine (63yo)

    Executive VP & COO

    • Tenure: 1yrs
  • Jim Bunn (46yo)

    Co-President of Global Equities & Investment Banking

    • Tenure: 1.1yrs
    • Compensation: US$4.74m
  • Jeff Dowdle (55yo)

    COO & Head of Asset Management Group

    • Tenure: 0.3yrs
  • Paul Shoukry (34yo)

    CFO, Senior VP of Finance & Investor Relations and Treasurer

    • Larry Adam

      Chief Investment Officer

      • Tenure: 1.2yrs

    Board Members

    • Tom James (76yo)

      Chairman Emeritus

      • Tenure: 2.9yrs
      • Compensation: US$3.08m
    • Bo Godbold (75yo)

      Vice Chairman of the Board

      • Tenure: 18yrs
      • Compensation: US$125.78k
    • Susan Story (59yo)

      Lead Independent Director

      • Tenure: 4yrs
      • Compensation: US$279.14k
    • Paul Reilly (64yo)

      Chairman & CEO

      • Tenure: 9.7yrs
      • Compensation: US$11.12m
    • Shelley Broader (54yo)

      Non-Executive Director

      • Tenure: 11.9yrs
      • Compensation: US$254.14k
    • Jeff Edwards (57yo)

      Independent Non-Executive Director

      • Tenure: 5.9yrs
      • Compensation: US$252.66k
    • Charlie von Arentschildt (59yo)

      Independent Non-Executive Director

      • Tenure: 4.4yrs
      • Compensation: US$251.40k
    • Ben Esty (56yo)

      Independent Non-Executive Director

      • Tenure: 5.9yrs
      • Compensation: US$302.66k
    • Gordon Johnson (61yo)

      Independent Non-Executive Director

      • Tenure: 9.4yrs
      • Compensation: US$327.22k
    • Paul Allison (63yo)

      Chairman

      • Tenure: 11yrs
      • Compensation: US$1.80m

    Company Information

    Raymond James Financial, Inc.'s company bio, employee growth, exchange listings and data sources


    Key Information

    • Name: Raymond James Financial, Inc.
    • Ticker: RJF
    • Exchange: NYSE
    • Founded: 1962
    • Industry: Investment Banking and Brokerage
    • Sector: Diversified Financials
    • Market Cap: US$13.355b
    • Shares outstanding: 138.72m
    • Website: https://www.raymondjames.com

    Number of Employees


    Location

    • Raymond James Financial, Inc.
    • 880 Carillon Parkway
    • St. Petersburg
    • Florida
    • 33716
    • United States

    Listings

    TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
    RJFNYSE (New York Stock Exchange)YesCommon StockUSUSDJul 1983
    RJFDB (Deutsche Boerse AG)YesCommon StockDEEURJul 1983
    0KU1LSE (London Stock Exchange)YesCommon StockGBUSDJul 1983
    RJF *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNJul 1983

    Biography

    Raymond James Financial, Inc., through its subsidiaries, engages in the underwriting, distribution, trading, and brokerage of equity and debt securities, and the sale of mutual funds and other investment products in the United States, Canada, and Europe. It operates in five segments: Private Client Group (PCG), Capital Markets, Asset Management, Raymond James (RJ) Bank, and Other. The PCG segment offers securities transaction services, including the sale of equities, mutual funds, fixed income products, and insurance and annuity products to retail clients; investment advisory, investment, and margin loan services; custodial, trading, research, and other support services; diversification strategies and alternative investment products; and borrowing and lending of securities to and from other broker-dealers, financial institutions, and other counterparties. The Capital Markets segment engages in the fixed income and equity institutional sales and trading activities; equity research and investment banking activities; and syndication and related management of investments that qualify for tax credits. It also provides debt and equity underwriting, merger and acquisition, advisory, and public finance services. The Asset Management segment offers portfolio management and related administrative services for retail and institutional clients; and administrative support services, such as record-keeping. The RJ Bank segment provides corporate loans, SBL, tax-exempt loans, residential loans, and other loans. The Other segment engages in the private equity activities, including various direct and third-party private equity investments; and private equity funds. The company was founded in 1962 and is headquartered in St. Petersburg, Florida. 


    Company Analysis and Financial Data Status

    All financial data provided by Standard & Poor's Capital IQ.
    DataLast Updated (UTC time)
    Company Analysis2020/01/18 23:40
    End of Day Share Price2020/01/17 00:00
    Earnings2019/09/30
    Annual Earnings2019/09/30


    Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.