Raymond James Q1 Earnings Beat on Higher Revenues, IB Weakness Ails

Raymond James’ RJF first-quarter fiscal 2026 (ended Dec. 31) adjusted earnings of $2.86 per share beat the Zacks Consensus Estimate of $2.83. However, the bottom line declined 2% from the prior-year quarter.

Results benefited primarily from an increase in revenues. Continued growth in asset management and related administrative fees was recorded. Robust growth in assets under administration balances to record levels further supported results. However, an increase in expenses and weakness in the capital markets business were major headwinds.

Net income available to common shareholders (GAAP basis) was $562 million or $2.79 per share, down from $599 million or $2.86 in the prior-year quarter.

RJF’s Revenues Increase, Expenses Rise

Quarterly net revenues were a record $3.74 billion, up 6% year over year. The top line beat the Zacks Consensus Estimate of $3.73 billion.

Segment-wise, in the reported quarter, the Private Client Group recorded 9% year-over-year growth in net revenues. Asset Management’s net revenues rose 11%, while Capital Markets’ top line plunged 21%. Bank registered a rise of 15% from the prior year's net revenues, while Others recorded negative revenues.

Non-interest expenses jumped 8% to $3.01 billion. The increase was due to a rise in all cost components except for bank loan provision for credit losses and others. 

As of Dec. 31, 2025, client assets under administration were a record $1.77 trillion, up 14% from the prior-year period. Financial assets under management of $280.8 billion grew 15% year over year.

RJF’s Balance Sheet & Capital Ratios Strong

As of Dec. 31, 2025, Raymond James had total assets of $88.8 billion, up 1% from the prior-quarter end. Total common equity was $12.5 billion, up 1%.

Book value per share was $63.41, up from $49.49 as of Dec. 31, 2024.

As of Dec. 31, 2025, the total capital ratio was 24.3%, down from 25% as of Dec. 31, 2024. The Tier 1 capital ratio was 23.2% compared with 23.7% as of Dec. 31, 2024.

Return on common equity (annualized basis) was 18% at the end of the reported quarter compared with 20.4% a year ago.

Update on Raymond James’ Share Repurchases

In the reported quarter, RJF repurchased shares worth $400 million at an average price of $162 per share.

During the quarter, Raymond James authorized share repurchases of up to $2 billion, which replaced the previous plan. As of Dec. 31, 2025, $1.9 billion remained available under the repurchase authorization.

Our Take on Raymond James

Raymond James’ global diversification efforts, strategic acquisitions and relatively high rates are expected to support top-line growth. Also, a robust capital markets business is a positive. However, elevated operating expenses remain a major concern.
 

Raymond James Financial, Inc. Price, Consensus and EPS Surprise

Raymond James Financial, Inc. price-consensus-eps-surprise-chart | Raymond James Financial, Inc. Quote

Currently, Raymond James carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of RJF’s Peers

Morgan Stanley’s MS fourth-quarter 2025 earnings of $2.68 per share easily outpaced the Zacks Consensus Estimate of $2.41. Also, the bottom line jumped 21% from the prior-year quarter.

Morgan Stanley’s investment banking business gained from a frenzy of deal-making activities and IPOs. Also, the company posted a decent trading performance. The performance of the company’s wealth management and investment management businesses was impressive too, driven by a rise in client assets and assets under management.

Charles Schwab’s SCHW fourth-quarter 2025 adjusted earnings of $1.39 per share beat the Zacks Consensus Estimate of $1.37. The bottom line soared 38% year over year.

Quarterly results benefited from the robust performance of the asset management business and an increase in trading revenues. Higher net interest revenues and solid brokerage account numbers were other positives. However, an increase in expenses was the undermining factor for Schwab.

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This article originally published on Zacks Investment Research (zacks.com).

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