Evercore stock rating downgraded by Citizens JMP as shares rally 80%

Investing.com - Citizens JMP analyst Devin Ryan downgraded Evercore Partners (NYSE:EVR) from Market Outperform to Market Perform on Monday, following an approximately 80% rally in the stock since the firm’s April 8 upgrade. According to InvestingPro data, the stock is now trading near Fair Value, with a market capitalization of nearly $12 billion and an overall financial health score rated as "GREAT."

The downgrade comes just three months after Citizens JMP had upgraded the independent advisory firm, with Ryan noting that investors have "done a complete 180 on the stock in short order" and are now "more appropriately appreciating the intermediate-term earnings power." The stock has delivered a 30% return over the past year, with impressive revenue growth of 27% in the last twelve months.

Ryan highlighted that more than half of Evercore’s first quarter revenue came from non-M&A advisory activities, a diversification value that has become "better understood in the market" since the April upgrade.

The analyst maintained a bullish outlook on Evercore’s ability to grow at an elevated pace, but indicated the stock now appears fairly valued trading at 17.1x Citizens JMP’s normalized earnings estimate of approximately $17 per share.

Citizens JMP had previously set a price target of $230 for Evercore shares, though no new price target was specified in the downgrade announcement.

In other recent news, Evercore has reported its first-quarter 2025 earnings, significantly exceeding analysts’ expectations with an adjusted earnings per share (EPS) of $3.49, compared to the forecasted $2.35. Despite a slight revenue shortfall, the company’s net revenues increased by 19% year-over-year, reaching $700 million. Evercore announced a $250 million private placement of senior notes, with the proceeds partly intended to repay maturing notes. The company is also expanding its Chicago office to accommodate its growing team, driven by increasing client demand in the Midwest region.

Morgan Stanley (NYSE:MS) recently upgraded Evercore from Equalweight to Overweight, citing its substantial exposure to large-cap deals and a strong performance in its Private Capital Advisory (PCA) business. The investment bank noted that PCA revenues led to a significant earnings per share beat in the first quarter of 2025. Evercore has also maintained its prominence in major transactions, advising on three of the top six mergers this year.

Additionally, Evercore’s strategic hiring and talent expansion have bolstered its performance across various business lines. The firm continues to focus on long-term client relationships and strategic growth initiatives, despite expecting market volatility to impact transaction levels in the upcoming quarters.

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