Raymond James Financial Q4 Earnings Call Highlights

Key Points

• Record results: Raymond James reported fiscal Q4 revenue of $4.27 billion, up 15% year over year, and adjusted earnings of $3.59 per diluted share. Fiscal 2026 marked the company’s sixth consecutive year of record annual performance.
• Broad-based growth: Private Client Group assets reached a record $1.87 trillion, while bank loans rose to $57.5 billion and investment banking revenue exceeded $1.1 billion for the year. Advisor recruiting, market appreciation, net new assets and acquisitions supported growth across the business.
• 2027 outlook and capital returns: Raymond James expects fiscal 2027 non-compensation expenses to rise about 8% to $2.5 billion and plans to resume share repurchases at roughly $400 million per quarter after temporarily reducing buybacks to evaluate an acquisition.

Raymond James Financial NYSE: RJF reported record fourth-quarter and fiscal 2026 results, extending its streak of record annual performance to six consecutive years as growth in its Private Client Group, investment banking and bank lending supported revenues and profitability.

For the fiscal fourth quarter, the company generated record net revenues of $4.27 billion, up 15% from a year earlier and 9% from the preceding quarter. Record pre-tax income totaled $862 million, rising 18% year over year and 15% sequentially. Net income available to common shareholders was $666 million, or $3.40 per diluted share. On an adjusted basis, excluding acquisition-related expenses, earnings were $3.59 per diluted share.

Chief Executive Officer Paul Shoukry said the results reflected the firm’s investments in personnel, technology and capabilities, as well as the work of its financial advisors, bankers and associates. The company ended fiscal 2026 with an adjusted return on tangible common equity of 23%, he said.

Private Client Group assets and recruiting rise

Raymond James ended the quarter with a record $1.87 trillion of client assets under administration, up 12% from the prior-year period and 1% from the prior quarter. Domestic Private Client Group net new assets rose 88% during fiscal 2026 to a record of more than $98 billion, representing 6.4% of beginning-of-year assets.

During the year, the firm recruited advisors to its domestic independent contractor and employee channels who had combined trailing-12-month production of $538 million and more than $82 billion in client assets at their prior firms. Shoukry said the company’s recruiting pipeline remained broad across its affiliation options.

Private Client Group fourth-quarter revenue reached a record $3.06 billion and pre-tax income was $458 million. Revenue rose 15% from a year earlier, driven by higher assets under administration, market appreciation, retention and net new assets. Pre-tax income increased 10%, with growth partly offset by higher advisor commissions and recruiting-related expenses.

Shoukry said the company is continuing to invest more than $1.1 billion annually in technology, automation and artificial intelligence. He cited the firm’s proprietary AI assistant, Raimond, and an AI-enabled meeting manager and integrated customer relationship management workflow as tools designed to reduce administrative work for advisors and associates.

“We are making significant investments in technology and AI, not with a focus on disintermediating our financial advisors,” Shoukry said, “but instead with a focus on saving our advisors’ and associates’ time on administrative tasks.”

Capital markets, asset management and bank results

Capital Markets posted quarterly net revenues of $549 million and pre-tax income of $106 million. Revenue increased both year over year and sequentially, primarily because of higher merger-and-acquisition and advisory revenue. Those gains were partly offset by lower fixed-income brokerage revenue, as higher rates and market volatility created a difficult environment, particularly for municipal securities.

The company reported record consolidated investment banking revenues of more than $1.1 billion for fiscal 2026. Shoukry said the investment banking pipeline remained strong, with activity supported by financial sponsors seeking to exit portfolio investments held beyond their originally intended periods.

Raymond James also continued to add capabilities through acquisitions and hiring. During fiscal 2026, it acquired GreensLedge to complement structured-products distribution capabilities and acquired Clark Capital, an asset manager serving advisor-oriented channels. The company also added a leveraged finance and debt advisory practice, expanded its ESOP advisory and consumer franchises, and said its acquisition of MBS Capital Markets bolstered public-finance capabilities.

Asset Management generated record quarterly net revenues of $409 million and record pre-tax income of $170 million. Results reflected higher assets under management, market appreciation, net inflows into Private Client Group fee-based accounts and the addition of Clark Capital. The company’s quarter-end Private Client Group fee-based assets were a record $1.16 trillion, up 15% from a year earlier.

Bank segment net revenues were $483 million and pre-tax income was $180 million. Bank loans ended the quarter at a record $57.5 billion, up 11% year over year and 2% sequentially. Securities-based lending balances increased more than $6 billion, or 32%, from the prior-year period. The company said credit quality remained strong, and results included a loan-loss reserve release as its loan mix shifted toward lower-risk securities-based loans and residential mortgages.

Fiscal 2027 outlook and capital deployment

Chief Financial Officer Butch Oorlog said Raymond James expects first-quarter fiscal 2027 asset-management and related administrative fees to rise about 1% from the fourth-quarter level, based on higher quarter-end fee-based assets. The company also expects combined net interest income and fees from its Raymond James Bank Deposit Program balances at third-party banks to increase approximately 1% sequentially, assuming unchanged quarter-end balances after the expected $2.1 billion fiscal first-quarter fee-billing collection.

For fiscal 2027, Raymond James expects non-compensation expenses, excluding specified items, to total about $2.5 billion, an increase of roughly 8% from fiscal 2026. Acquired businesses account for approximately 100 basis points of that expected increase, Oorlog said. The company estimates a fiscal 2027 effective tax rate of about 25%, excluding any effect from corporate-owned life insurance portfolio valuation.

The firm returned $154 million to shareholders through dividends and share repurchases during the quarter. It repurchased $50 million of stock at an average price of $166 per share. Over the past 12 months, Raymond James repurchased approximately 8 million shares for $1.25 billion and returned $1.7 billion including dividends, or 71% of earnings.

Shoukry said share repurchases had been temporarily curtailed while the company evaluated an acquisition opportunity that is not expected to advance. He said Raymond James plans to resume buybacks at a $400 million quarterly pace without a catch-up purchase.

At quarter end, the company had $2.9 billion of corporate cash at the parent company, $1.7 billion above its $1.2 billion target. Its tier-one leverage ratio was 12.1%, with approximately $1.9 billion of excess capital capacity available before reaching its 10% target.

About Raymond James Financial (NYSE:RJF)

Raymond James Financial, Inc is a diversified financial services company serving individuals, corporations, municipalities and institutions. Through its subsidiaries and affiliated advisors, the company provides wealth management, investment advisory, financial planning, securities brokerage, banking and capital markets services.

The company's Private Client Group offers investment management, retirement planning, estate planning and other financial planning services through a network of financial advisors.

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