SF Q4 Deep Dive: Wealth Management and Advisory Momentum Drive Outperformance

Financial services firm Stifel Financial (NYSE:SF) beat Wall Street’s revenue expectations in Q4 CY2025, with sales up 14.4% year on year to $1.56 billion. Its non-GAAP profit of $2.63 per share was 4.8% above analysts’ consensus estimates.

Is now the time to buy SF? Find out in our full research report (it’s free for active Edge members).

StockStory’s Take

Stifel’s fourth quarter results exceeded Wall Street’s expectations, with management attributing the outperformance to strength in both its Global Wealth Management and Institutional segments. CEO Ronald James Kruszewski emphasized that record adviser recruiting and strong client activity underpinned the firm’s revenue growth, while the institutional business benefited from robust investment banking, particularly in advisory and capital markets. CFO James Marischen noted that operating leverage and disciplined expense control also played a significant role in delivering higher profitability, as compensation and non-compensation expenses remained well aligned with revenue growth. The quarter’s performance was further bolstered by increased client assets, a resilient balance sheet, and elevated activity in key sectors such as healthcare and financials.

Looking forward, management expects continued momentum in adviser recruiting and a strong pipeline in advisory and capital markets to sustain growth into next year. Kruszewski highlighted that the firm’s integrated platform and technology are attracting larger, more productive teams, which is expected to drive further productivity gains. Marischen outlined expectations for balance sheet expansion—mainly through client-driven lending—and maintained that Stifel’s business remains relatively insulated from interest rate fluctuations. The company plans to manage expenses through business simplification and operational efficiencies, with Kruszewski stating, “Our adviser-led integrated model continues to differentiate Stifel,” and expressing confidence in the firm’s ability to capitalize on market opportunities across wealth management and investment banking.

Key Insights from Management’s Remarks

Management attributed the quarter’s outperformance to record adviser recruitment, elevated capital markets activity, and strong execution in both core business segments.

• Record adviser recruiting: Stifel’s Global Wealth Management segment saw its best adviser recruiting year since 2018, with a focus on attracting experienced teams whose productivity improved notably after joining the firm’s integrated platform.
• Investment banking strength: Institutional segment growth was led by investment banking, especially advisory services, with management citing increased M&A activity in financials and rising momentum in healthcare and technology sectors.
• Fee-based asset growth: The quarter closed with record client assets and fee-based assets, driven by market appreciation and net new asset flows, which management expects to support consistent future revenue.
• Business simplification initiatives: The sale of Stifel Independent Advisors and the exit from the European equities business are expected to enhance operating leverage and lower compensation ratios, reflecting a shift towards higher-margin activities.
• Capital management actions: An 11% dividend increase and a three-for-two stock split were authorized, signaling the board’s confidence in the firm’s capital generation and long-term earnings durability.

Drivers of Future Performance

Stifel’s outlook is shaped by ongoing adviser recruitment, capital markets momentum, and disciplined expense management as it targets further operating leverage.

• Adviser recruiting acceleration: Management plans to allocate additional resources to adviser recruitment, aiming to increase market share and asset flows. Larger, more productive teams are expected to drive growth in fee-based assets and client lending activity.
• Strong advisory and capital markets pipeline: A robust backlog in advisory and capital markets—particularly in financials, healthcare, and technology—positions Stifel to benefit from anticipated increases in M&A and equity issuance, though the firm remains mindful of potential market volatility and geopolitical risks.
• Expense leverage from restructuring: Recent business exits and simplification efforts are projected to lower compensation and non-compensation ratios, supporting margin expansion even as investments continue in technology and adviser capabilities.

Catalysts in Upcoming Quarters

In the coming quarters, our analysts will be tracking (1) the pace and quality of adviser recruiting and resulting fee-based asset growth, (2) execution on capital markets mandates in advisory and equity issuance, and (3) the realization of expense savings from recent business simplification initiatives. Additionally, we will monitor Stifel’s ability to navigate shifting market conditions and capitalize on emerging M&A and capital raising opportunities across sectors.

Stifel currently trades at $126.21, in line with $126.34 just before the earnings. Is the company at an inflection point that warrants a buy or sell? Find out in our full research report (it’s free).

High Quality Stocks for All Market Conditions

The market’s up big this year - but there’s a catch. Just 4 stocks account for half the S&P 500’s entire gain. That kind of concentration makes investors nervous, and for good reason. While everyone piles into the same crowded names, smart investors are hunting quality where no one’s looking - and paying a fraction of the price. Check out the high-quality names we’ve flagged in our Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 244% over the last five years (as of June 30, 2025).

Stocks that have made our list include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today.