Hsbc Holdings PLC Lowers Holdings in Jefferies Financial Group Inc. $JEF

Key Points

• HSBC Holdings cut its Jefferies Financial Group stake by 51.6% in the second quarter, selling 62,048 shares and retaining 58,278 shares valued at approximately $2.93 million. Institutional investors collectively own 60.88% of JEF.
• Analysts maintain a generally cautious view, with two Buy ratings and five Hold ratings producing a consensus “Hold” rating and a $64.25 price target. JEF recently traded near $53.88 after reporting quarterly EPS and revenue below expectations.
• Jefferies declared a quarterly dividend of $0.40, representing a 3.0% annualized yield, and authorized a $250 million share-repurchase program covering up to 2% of outstanding shares.

Hsbc Holdings PLC cut its position in shares of Jefferies Financial Group Inc. (NYSE:JEF - Free Report) by 51.6% in the second quarter, according to the company in its most recent filing with the Securities & Exchange Commission. The institutional investor owned 58,278 shares of the financial services provider's stock after selling 62,048 shares during the period. Hsbc Holdings PLC's holdings in Jefferies Financial Group were worth $2,934,000 as of its most recent filing with the Securities & Exchange Commission.

Several other hedge funds have also made changes to their positions in the company. Bank of Nova Scotia purchased a new position in Jefferies Financial Group during the 2nd quarter valued at about $3,509,000. Intech Investment Management LLC raised its stake in Jefferies Financial Group by 95.7% in the fourth quarter. Intech Investment Management LLC now owns 132,263 shares of the financial services provider's stock worth $8,196,000 after buying an additional 64,682 shares in the last quarter. Berkshire Hathaway Inc purchased a new stake in Jefferies Financial Group during the second quarter worth $21,669,000. Check Capital Management Inc. CA bought a new stake in Jefferies Financial Group during the 4th quarter valued at $28,041,000. Finally, Fideuram Intesa Sanpaolo Private Banking S.P.A. purchased a new position in shares of Jefferies Financial Group in the 1st quarter valued at $2,941,000. 60.88% of the stock is currently owned by hedge funds and other institutional investors.

Wall Street Analyst Weigh In

JEF has been the topic of a number of recent research reports. UBS Group dropped their price objective on Jefferies Financial Group from $67.00 to $65.00 and set a "neutral" rating on the stock in a research report on Thursday, June 25th. Loop Capital set a $60.00 target price on shares of Jefferies Financial Group in a report on Monday, June 8th. Weiss Ratings lowered shares of Jefferies Financial Group from a "hold (c)" rating to a "hold (c-)" rating in a research report on Thursday, August 27th. BMO Capital Markets raised their price target on shares of Jefferies Financial Group from $42.00 to $60.00 and gave the company a "market perform" rating in a report on Monday, June 8th. Finally, Morgan Stanley lifted their price objective on shares of Jefferies Financial Group from $44.00 to $50.00 and gave the stock an "equal weight" rating in a research report on Tuesday, June 9th. Two analysts have rated the stock with a Buy rating and five have assigned a Hold rating to the company's stock. According to data from MarketBeat.com, the company currently has an average rating of "Hold" and a consensus target price of $64.25.

Jefferies Financial Group Price Performance

Shares of JEF stock opened at $53.88 on Friday. Jefferies Financial Group Inc. has a fifty-two week low of $35.53 and a fifty-two week high of $71.04. The company has a debt-to-equity ratio of 1.99, a quick ratio of 0.98 and a current ratio of 0.98. The firm has a market capitalization of $10.44 billion, a price-to-earnings ratio of 15.05 and a beta of 1.52. The stock's 50-day simple moving average is $54.43 and its 200-day simple moving average is $50.70.

Jefferies Financial Group (NYSE:JEF - Get Free Report) last announced its quarterly earnings data on Wednesday, June 24th. The financial services provider reported $1.02 EPS for the quarter, missing the consensus estimate of $1.16 by ($0.14). The company had revenue of $2.21 billion during the quarter, compared to analysts' expectations of $2.30 billion. Jefferies Financial Group had a net margin of 7.58% and a return on equity of 9.23%. The business's revenue for the quarter was up 35.0% compared to the same quarter last year. During the same period in the previous year, the business earned $0.40 earnings per share. As a group, equities analysts forecast that Jefferies Financial Group Inc. will post 3.71 earnings per share for the current fiscal year.

Jefferies Financial Group Dividend Announcement

The business also recently declared a quarterly dividend, which was paid on Friday, August 28th. Shareholders of record on Tuesday, August 18th were issued a $0.40 dividend. The ex-dividend date of this dividend was Tuesday, August 18th. This represents a $1.60 dividend on an annualized basis and a dividend yield of 3.0%. Jefferies Financial Group's dividend payout ratio (DPR) is currently 44.69%.

Jefferies Financial Group declared that its board has initiated a stock repurchase plan on Wednesday, June 24th that permits the company to repurchase $250.00 million in outstanding shares. This repurchase authorization permits the financial services provider to purchase up to 2% of its shares through open market purchases. Shares repurchase plans are often an indication that the company's board of directors believes its shares are undervalued.

Key Headlines Impacting Jefferies Financial Group

Here are the key news stories impacting Jefferies Financial Group this week:

• Positive Sentiment: A Jefferies-linked trade-finance fund obtained an asset-freezing order against Radiant World in Singapore. The legal action could improve recovery prospects on disputed assets and may help limit losses. Jefferies fund wins Singapore asset freeze against Radiant World
• Neutral Sentiment: Jefferies is reportedly winding down its outsourced fixed-income trading business. The move could reduce operational and counterparty risk, but it may also pressure revenue and raise questions about the company’s strategy in the business. Jefferies to Wind Down Outsourced Fixed-Income Trading Business
• Negative Sentiment: Reports indicate that LAM Trade Finance Group II had nearly $500 million of exposure to Radiant World, its founder and another entity, based on a London freezing order. Investors are focused on whether the fund is legally and financially separate from JEF or whether the parent could face losses, reputational damage or additional scrutiny. The extent of any direct exposure has not been established. Jefferies linked fund faces reported Radiant exposure

Jefferies Financial Group Company Profile

Jefferies Financial Group Inc NYSE: JEF is a diversified financial services company that provides investment banking, capital markets, asset management and wealth management services. Its principal operating business, Jefferies, advises companies, governments and institutional investors on mergers and acquisitions, capital raising, restructuring and other strategic transactions.

Through its investment banking and securities operations, Jefferies offers equity and fixed-income underwriting, sales and trading, research, prime brokerage and related services.

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