Jefferies misses revenue estimates in Q2 despite advisory, equities strength

Jefferies Financial Group Inc.

Jefferies Financial Group Inc.

JEF

0.00


Overview

  • U.S. investment bank's preliminary Q2 revenue missed analyst expectations, with record advisory and equities net revenues

  • Net income for Q2 rose yr/yr; only two analyst estimates provided

  • Company repurchased 4 mln shares for $197 mln and increased buyback authorization to $250 mln


Outlook

  • Jefferies expects to build further on current momentum in coming periods

  • Company says it is optimistic about H2 2026 due to strong backlog and new business bookings

  • Company targets closing Hildene investment in Q3 2026, expects immediate accretion to results


Result Drivers

  • INVESTMENT BANKING GAINS - Co said record investment banking net revenues were driven by market share gains and a growing addressable market in advisory and equity underwriting

  • EQUITIES TRADING - Record equities net revenues attributed to higher global trading volumes, market share gains in cash and electronic trading, and growth in prime services

  • ASSET MANAGEMENT WEAKNESS - Asset management fees and investment return declined due to weaker performance across several fund strategies and reduced capital allocation


Company press release: ID:nBw9SdVWGa


Key Details

Metric

Beat/Miss

Actual

Consensus Estimate

Q2 Revenue

Miss

$2.21 bln

$2.3 bln (4 Analysts)

Q2 Net Income

$226.23 mln

$306.37 mln (2 Analysts)

Q2 Pretax Profit

$315.55 mln


Analyst Coverage

  • The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 3 "strong buy" or "buy", 3 "hold" and no "sell" or "strong sell"

  • The average consensus recommendation for the investment banking & brokerage services peer group is "buy"

  • Wall Street's median 12-month price target for Jefferies Financial Group Inc is $66.00, about 9.1% above its June 23 closing price of $60.52

  • The stock recently traded at 14 times the next 12-month earnings vs. a P/E of 10 three months ago


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