Nomura Initiates Coverage on Stifel

In a report published Thursday, Nomura analyst Steven Chubak initiated coverage on

at Neutral, with a $46.00 price target. According to the report, justifying a positive rating on Stifel shares is a struggle, as the revenue contribution from lower-multiple Institutional businesses continues to build and the valuation appears too rich trading above 17x consensus NTM earnings. “However, management's plan to grow the bank could provide a meaningful boost to the bottom line, as lending activities produce much higher margins, and the potential upside here is not reflected in consensus forecasts (which our 2014E-15E EPS estimates are ~6% above),” the report noted. Some highlights from the report included: -”Given elevated short interest (7% of float and 15 days to cover), and Street numbers that appear too low, we caution shorts to tread lightly.” -FY13E EPS at $2.35. -FY14E EPS at $2.88. SF closed Wednesday at $48.95.