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Investing.com - Citi has raised its price target on Raymond (NSE:RYMD) James (NYSE:RJF) to $170.00 from $165.00 while maintaining a Neutral rating on the stock. The $34.77 billion financial services firm currently trades at a P/E ratio of 13.7, which InvestingPro analysis suggests represents an attractive valuation relative to its growth potential.
Raymond James reported adjusted earnings per share of $2.18, falling short of Citi’s estimate of $2.28 and the FactSet consensus of $2.37. The results included a one-time legal reserve of $58 million, which impacted earnings by approximately $0.21 per share. Despite this setback, the company maintains strong fundamentals with revenue growing at 13.4% and an impressive 41-year track record of consistent dividend payments, currently yielding 1.24%.
Citi noted that equity market strength in the second quarter will provide a tailwind to Raymond James’ asset management and fee-related revenues. The company continues to experience positive loan growth trends, particularly in securities-based lending (SBL).
Raymond James management remains optimistic about the recruiting outlook due to positive momentum, along with improving net new asset trends observed in June. The capital markets environment is also beginning to show improvement.
Despite these positive indicators, Citi believes the recent stock performance already reflects these developments, leading the analyst to prefer waiting for a more attractive entry point while maintaining a Neutral stance on Raymond James shares. According to InvestingPro’s Fair Value analysis, the stock currently shows modest upside potential.
In other recent news, Raymond James Financial Inc . reported its fiscal third-quarter earnings with mixed results. The company posted an adjusted earnings per share (EPS) of $2.18, which fell short of analysts’ expectations of $2.37, marking an 8.02% miss. Despite this, the company’s revenue exceeded forecasts, reaching $3.4 billion compared to the projected $3.37 billion. The earnings report also highlighted a one-time $58 million increase in other expenses due to a legal settlement related to a bond underwriting from 2013 to 2015, impacting EPS by $0.29.
In terms of analyst ratings, Citizens JMP analyst Devin Ryan reiterated a Market Outperform rating for Raymond James, maintaining a price target of $180. These developments reflect the ongoing evaluation of the company’s financial performance and future potential by market analysts.
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