Is Raymond James Fairly Priced After Recent Earnings Beat and Stock Volatility in 2025?

If you have been watching Raymond James Financial lately and wondering whether it is still a buy, you are not alone. With the stock down 3.2% in the past week and slipping a modest 1.1% over the past month, it might seem like momentum is cooling. However, when you look at the bigger picture, you will notice some remarkable long-term gains. This stock has surged 7.4% year-to-date, 35.2% in the last year, and a stunning 242.7% over the past five years.

What is behind this performance? Much of the recent volatility can be traced to shifting risk sentiment in the financial sector. As markets react to evolving monetary policy and broader moves in financial stocks, Raymond James Financial has responded with both resilience and moments of pullback. It has been a story of steady strength punctuated by bouts of nervousness, making each dip a potential opportunity for sharp-eyed investors.

If you are weighing whether now is the right moment to invest or add to your position, it is important to look past just the price chart. That is where valuation comes into play, acting as a reality check on all the excitement. According to a numerical score that covers six different valuation tests, Raymond James Financial comes in at a 4, meaning it is considered undervalued in four out of six categories.

Next, we will break down how this score is calculated using widely accepted valuation methods. Before you make any decisions, one powerful approach that can cut through the noise even more effectively will also be explored, so stay tuned.

Raymond James Financial delivered 35.2% returns over the last year. See how this stacks up to the rest of the Capital Markets industry.

Approach 1: Raymond James Financial Excess Returns Analysis

The Excess Returns model assesses a company's value by examining how much profit it generates in excess of its cost of capital, using its book value as a foundation for long-term growth. This method highlights how efficiently Raymond James Financial is turning shareholder equity into profits, a key insight for financial companies.

Raymond James Financial's Book Value stands at $60.90 per share, with a stable Earnings Per Share estimate of $11.29, as projected by a consensus of five analysts. Its Cost of Equity is $5.02 per share, meaning the company delivers an Excess Return of $6.27 per share. The average Return on Equity is an impressive 18.91%, showing strong profitability and management effectiveness. Additionally, the stable Book Value, drawn from three analyst forecasts, is estimated at $59.71 per share.

Based on these strong excess returns, the model arrives at an intrinsic value of $177.45 per share. Since this is about 6.2% above the current price, Raymond James Financial is trading roughly in line with its fair value.

Result: ABOUT RIGHT

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Raymond James Financial.

Simply Wall St performs a valuation analysis on every stock in the world every day (check out Raymond James Financial's valuation analysis). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes.

Approach 2: Raymond James Financial Price vs Earnings

The Price-to-Earnings (PE) ratio is a widely used metric for valuing consistently profitable companies like Raymond James Financial, as it measures how much investors are willing to pay for each dollar of earnings. A higher PE ratio can reflect growing optimism about a company’s prospects, while a lower ratio may indicate tempered expectations or perceived risks.

What determines a "normal" or “fair” PE ratio? Two major factors are growth expectations and company-specific risks. Companies with strong, predictable growth and lower risk profiles often have higher PEs, since investors are willing to pay more for future earnings. Conversely, increased uncertainty or flat earnings usually lower a company’s PE multiple.

Raymond James Financial currently trades at a PE of 15.6x. This is significantly below both its industry average of 26.2x and a group of similar peers, which average 25.0x. At first glance, this discount may seem like a bargain. However, Simply Wall St’s proprietary "Fair Ratio" estimates the PE that best fits Raymond James Financial’s unique mix of earnings growth, margins, risk, size, and sector factors. For Raymond James Financial, the Fair Ratio is 17.4x, which is only slightly higher than today’s PE. This custom benchmark can be more insightful than general comparisons, as it accounts for features that distinguish the company from the average competitor or industry member.

With the current PE just below the Fair Ratio, the takeaway for investors is that Raymond James Financial’s stock is priced about right for its fundamentals and outlook.

Result: ABOUT RIGHT

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your Raymond James Financial Narrative

Earlier, we mentioned that there is an even better way to understand valuation, so let's introduce you to Narratives. A Narrative is a simple, powerful tool that connects the company's story, your personal thesis about what will drive growth, risks, and profitability, to a clear financial forecast and a corresponding fair value.

Instead of only looking at static numbers, Narratives allow you to factor in your assumptions about future revenue, earnings, and margins, and see how these shape what you think the stock should be worth. This approach makes investing more accessible and transparent, since you can build, adjust, or compare your Narrative right within Simply Wall St's Community page, a feature used by millions of investors.

By linking the current price with your Narrative’s fair value estimate, you get an actionable framework that can make it much easier to decide when to buy, sell, or hold. Best of all, Narratives update automatically when key news or earnings come out, so your view stays current without extra effort.

For example, some investors may see Raymond James Financial’s expanding advisor base and AI investment as reasons to expect higher future growth, leading them to set a fair value above today’s price. Others might focus on risks like market uncertainty and set their fair value below the current market, creating different, yet valid, Narratives for the same stock.

Do you think there's more to the story for Raymond James Financial? Create your own Narrative to let the Community know!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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