Raymond James Earnings: Moderating Interest-Rate Headwinds Allow Business Lines to Shine

Narrow-moat Raymond James Financial reported record quarterly net revenue, and moderating interest-rate headwinds should allow its business lines to shine. The company reported net income to common shareholders of $599 million, or $2.86 per diluted share, on $2.5 billion of net revenue for its fiscal first quarter ended in December. Net revenue increased 17% from the previous year and 2% sequentially, with gains in asset management and investment banking revenue offsetting modest declines in interest-rate-related revenue. We are maintaining our $147 fair value estimate and assess the shares as slightly overvalued after the runup in price since October.