Market Overview

Stifel Financial Earnings Preview (SF)


Stifel Financial Corporation (NYSE: SF), the holding company of the Stifel brokerage, is set to report earnings after the close of the market on Monday, May 9, 2011. Wall Street is expecting $395M in revenue and an EPS of $0.62. The top line consensus estimate is calling for 25% growth from the year-ago period. The company will host a conference call at 5:00 p.m. EST.

In early March, the company announced a three-for-two stock split, which boosted the number of shares outstanding from 35.9M to 53.9M. It went into effect for shareholders of record as of April 5. Since that time, shares have declined from 48.37 on April 5th to its current price of 43.22, approximately 10.6% lower as the company is set to report its earnings. Part of the reason for the shares' weakness could be due to the Wells Notice regarding an SEC investigation.

The company reported a strong 4Q2010, as well as the full-year with non-GAAP revenues up 26.1% and 26.9%, respectively. Earnings grew 56.3% in the fourth quarter of 2010 versus the same period a year ago. Commissions grew more then 40% from the year ago period and the merger of Thomas Wiesel Partners helped Investment Banking grow by more then 80 from 4Q2009. Principal transactions was the lone soft spot, declining 22.7% from the year ago levels.

With the economy maintaining (if not improving in) strength over the last 12 months, investors could expect similar growth that was exhibited in 4Q2010. The Standard & Poors SPDR ETF that tracks the financials, Financial Select Sector SPDR (NYSE: XLF), closed at $16.50 on April 5, the same day the split took effect. While decreasing in price for the first two weeks of April, the XLF then righted the ship and is down 2.3% in the same time frame.

Posted-In: Financial Select Sector SPDR Investment Banking Stifel Financial Corporation The Standard & Poors SPDR ETF Thomas Wiesel PartnersLong Ideas Short Ideas Trading Ideas


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