SF

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. - Management attributed record year-to-date performance to a diversified business model that allowed record Wealth Management results to offset a market-driven slowdown in Institutional segments. - The firm reported its lowest compensation ratio since Q4 2022, driven by efficiency initiatives and the structural benefits of an international restructuring program. - A strategic investment in Meow Technologies was framed as a catalyst for the venture banking platform, providing white-label treasury management and AI capabilities to accelerate deposit gathering. - Management highlighted a valuation gap compared to peers, arguing that Stifel's superior return on tangible common equity (26% over the last 12 months) and EPS growth are not reflected in its current forward earnings multiple. - The Institutional segment faced headwinds in September due to the speed of interest rate moves, which resulted in trading marks on securities inventory and a 'financial condition induced pause' in deal activity. - Wealth Management growth was supported by strong recruiting, with management shifting focus toward higher-production teams rather than absolute advisor headcount. - Management expects Q4 net revenue to match last year's record of $1.56 billion, assuming a recovery in investment banking and the absence of one-time trading marks. - Net interest income is projected to remain stable in the range of $295 million to $305 million for Q4, supported by a consistent net interest margin despite shifting funding mixes. - The firm anticipates a fourth-quarter effective tax rate between 19% and 22%, contingent on a stable stock price and excess tax benefits from stock-based compensation. - Institutional transactional revenue is expected to normalize to a range of $145 million to $150 million in Q4, assuming no further sharp interest rate spikes like those seen in September. - Strategic focus remains on reaching $1 trillion in client assets, with AI tools expected to enhance advisor productivity rather than replace human personnel. - The sale of Stifel Independent Advisors (SIA) impacted revenue run rates by approximately $70 million to $75 million but improved overall margins and return on tangible equity. - Institutional results included $16 million in combined trading marks across fixed income and equity facilitation due to volatile market conditions in late Q3. - Management noted that while the recruiting environment is highly competitive, they are maintaining discipline on transition packages to ensure appropriate returns on invested capital. - Geopolitical tensions, rising energy prices, and the upcoming U.S. election were cited as near-term variables that could influence the timing of the investment banking pipeline recovery. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. - Management indicated that the current lower comp ratio is a result of driving efficiencies and growing net interest income, which scales without proportional headcount increases. - The 'jumping-off point' for 2026 is considered a good baseline for 2027, though specific guidance will be provided in the next quarter. - The investment allows Stifel to offer a competitive treasury product including corporate credit cards and cross-border payments without building physical branches. - Management expects this technology to accelerate deposit generation beyond the current $1 billion per quarter rate by targeting venture and fund banking clients. - Activity is expected to be driven by secular trends such as the need for scale and technology, alongside a potential 'political reality' window for deal approvals before 2028. - Management clarified that recent delays were a 'pause' rather than cancellations, with pipelines remaining robust across financials, industrials, and healthcare. - The firm prioritizes high-return loan growth (like fund banking) but views its own stock as an attractive 'acquisition' given the perceived valuation discount. - Management stated they would be hesitant to pursue external M&A at high multiples (15-18x EBITDA) when they can buy back their own shares at lower valuations.

Stifel Financial entered its Q3 2026 report with the share price under pressure, down double digits over the past month and quarter, and slipping another 0.6% in the first session after results. That reaction sits awkwardly next to a quarter built around profitability strength, with basic earnings per share at about US$1.48 and net income near US$225 million. The core story is in the margin performance. Management reported a pretax margin of 22.5% and highlighted a roughly 24% return on tangible common equity, putting the focus firmly on how efficiently this broker dealer is converting its diversified revenue base into earnings power. Love Stifel Financial's profitability profile but concerned about the recent share price pressure and volatility around earnings season? Consider using our screener of list of solid balance sheet and fundamentals stocks (25 results). - Revenue (Q3 2026 vs. Q3 2025): US$1,418.3m vs. US$1,421.1m (broadly flat year over year) - Net Income (Excl. Extra Items, Q3 2026 vs. Q3 2025): US$224.8m vs. US$202.1m (up about 11%) - Basic EPS (Q3 2026 vs. Q3 2025): US$1.48 vs. US$1.31 (higher earnings per share, up about 13%) - Pretax Margin (Q3 2026 vs. Q3 2025): 22.5% vs. 16.0% net profit margin last year (profitability strength with a wider spread between revenue and pretax earnings) Earnings tell you what Stifel Financial reported this quarter, but investors who care about valuation often focus on the cash that actually comes in and out of the business over time. Looking at Stifel Financial's cash flows alone, the stock could be a notable 26% overvalued. The bullish view argues that richer fee revenue and a bigger balance sheet will eventually pull more profit out of each dollar of client assets. "Although expense ratios are guided lower on the back of scale benefits, the exit from Stifel Independent Advisors and European equities and the parallel running of cloud and data center infrastructure mean fixed costs remain elevated." Stifel Financial is now posting a 22.5% pretax margin and roughly 24% return on tangible common equity while revenue stays broadly flat year over year. Record Global Wealth Management revenue and stronger asset management and net interest income show those scale plans starting to reach the income statement even with elevated fixed costs. The cautious narrative focuses on adviser hiring spend, heavier fixed costs and a bigger credit book possibly dulling those margin gains. "The plan to recruit more financial advisers and potentially increase allocation to recruitment could keep compensation at the upper end of the guided 56.5% to 57.5% range or higher for longer, which may limit operating leverage and restrict improvement in pretax margins and earnings." Compensation pressure and parallel infrastructure clearly have not stopped pretax profitability from reaching 22.5%, yet Global Wealth Management net flows were slightly negative and Institutional revenue fell 14% year over year. Loan balances grew by about US$1.3b in the quarter toward a US$4b annual target. That supports net interest income but also increases exposure to the private credit and venture ecosystems, so credit quality remains an important swing factor for future earnings stability. One Narrative disagrees with today's price. → See where this Narrative says Stifel Financial should trade. Stifel Financial recently illustrated how earnings strength and share price pressure can diverge. The real opportunity is finding stocks that could be undervalued before the market corrects them. - Company 1 - 33% below our estimate - converts a large backlog of AI infrastructure and multicloud database contracts into heavier cloud usage and cash generation. - Company 2 - 47% below our estimate - supplies steel reinforcing products tied to long duration public infrastructure work and rising concrete and data center construction. - Company 3 - 46% below our estimate - integrates a new regional banking acquisition to expand low cost deposits and a broader loan portfolio under a conservative credit approach. That is three of the list. See the full list of 33 companies trading below our fair value estimates → This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include SF. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

Image source: The Motley Fool. Wed, Oct. 21, 2026 - Head of Investor Relations - Joel Jeffrey - Chairman and Chief Executive Officer - Ronald J. Kruszewski Operator: Good day, and welcome to the Stifel Financial Q3 '26 Financial Results Conference Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Joel Jeffrey, Head of Investor Relations. Please go ahead. Joel Jeffrey: Thank you, operator. Good morning, and welcome to Stifel's Third Quarter 2026 Earnings Call. On behalf of Stifel Financial Corp., I will begin the call with the following information and disclaimers: this call is being recorded. During today's presentation, we will refer to our earnings release and financial supplement, copies of which are available at stifel.com. Today's presentation may include forward-looking statements that are subject to risks and uncertainties that may cause actual results to differ materially. Stifel Financial Corp. does not undertake to update the forward-looking statements in this discussion. Please refer to our notices regarding forward-looking statements and non-GAAP measures that appear in the earnings release. I'll now turn the call over to our Chairman and Chief Executive Officer, Ron Kruszewski. Ronald J. Kruszewski: Thanks, Joel. Good morning, everyone, and thank you for joining us. Our results year-to-date and for the third quarter again underscore the strength of Stifel's diversified business model. We're on track for another record year. Year-to-date revenue was $4.3 billion, up 9%; earnings per share of $4.33, which is up 57%. And if you exclude the impacts of last year's legal charge, EPS is up 22% with return on tangible common equity of 24.1%. Revenue and pretax margins in both of our operating segments are up year-to-date and investments we've made in our efficiency initiatives continue to generate strong returns. The third quarter began with healthy client activity, but conditions got choppier in September as geopolitical tensions, rising energy prices and renewed inflation concerns led to the Federal Reserve's first rate increase in 3 years. It was the speed of the move in rates, more than their absolute level, that unsettled markets. Through it all, corporate earnings and employment stayed supportive and the underlying U.S. economy continued to show real resilience. Against that backdrop, we delivered our highest-ever third quarter earnings per share of $1.46, up 12% versus the prior year. Net revenue of $1.43 billion was in line with our guidance as another record quarter at our Global Wealth Management segment offset market-driven slowdown in our Institutional business. Our bottom line growth was the result of improved operating leverage as we posted our lowest compensation ratio since the fourth quarter of 2022, which in turn drove a pretax margin of 22.5%. The strength of our business allowed us to continue to generate and deploy significant excess capital. In the third quarter, we increased loans by $1.3 billion, and net interest income exceeded our guidance, setting a third quarter record that was essentially in line with our highest-ever quarterly total. Additionally, we repurchased 1.6 million shares as our strong capital position enables us to support clients, return capital to shareholders and invest in growth even when markets are volatile. That brings me to our recent strategic investment in Meow Technologies, one of the leading business banking fintechs in the United States. Along with our investment, we entered into a long-term licensing agreement with the company. Under this agreement, we will have access to all current and future capabilities of the Meow platform. This will provide our bank with a leading-edge white-label treasury management platform for our venture fund banking and other commercial clients. This transaction accelerates the build of one of our fastest-growing businesses, our venture banking platform. Additionally, this technology broadens our capabilities across our Institutional and Wealth segments, giving Stifel an AI platform and bringing family office capabilities into our wealth management platform. We believe it is a significant enhancement to our growing venture and fund banking platform. Slide 2 should look familiar since we used it about 4 years ago to point out that we saw the disconnect between our performance and our valuation compared with, in this case, Raymond James and Morgan Stanley, 2 firms I respect and whose business models look a lot like ours. Since the end of 2016, earnings per share are up 406% and tangible book value was up 154%, which is better than either of these peers and our return on tangible common equity over the last 12 months is more than 26% and is the highest of the 3 on this page. Even so, we trade at 9x forward earnings compared to 10.2 for Raymond James and 13 for Morgan Stanley. Look, even through challenging times, we are growing and have an elite ROTCE. Simply, the numbers don't support the valuation gap that I see. With that, I'll turn it over to Jim. James Marischen: Thanks, Ron, and good morning, everyone. Non-GAAP earnings per share of $1.46 came in ahead of consensus as stronger investment banking revenues, higher net interest income and well-controlled expenses more than offset softer transactional revenue. Total non-GAAP revenues of $1.43 billion were flat with a year ago and 1% below consensus. Investment banking revenue exceeded expectations by $12 million or 4% as both advisory and underwriting revenue surpassed Street expectations. Net interest income of $302 million came in above the high end of our guidance and $4 million above consensus primarily due to strong loan growth and higher loan fee income. Transactional revenue came in 10% below expectations and decreased 17% from the prior year. I'll cover the components in more detail when we get to the Institutional segment. Asset Management revenue increased 14% from the prior year, driven by market appreciation and net new asset growth and was essentially in line with consensus. Expenses were again well controlled, and we continue to see the benefits of the efficiency initiatives of the past few years. Our comp ratio of 56.6% was in line with consensus and improved from 57% in the second quarter. Non-compensation expense declined 4% sequentially and beat the Street estimate by 3% as lower credit provisions, travel and entertainment and non-bank reserve expenses contributed to the decline. The effective tax rate was 24.4%, which was slightly below consensus but within our guidance. Turning to Slide 4. Global Wealth Management generated record net revenue of $980 million, up 8% year-on-year. Results were driven by record asset management revenue and record third quarter net interest income, partially offset by a decline in transactional revenue. We ended the quarter with total client assets of $576 billion and fee-based assets of $240 billion, up 6% and 9%, respectively, as we benefited from stronger equity markets and net new asset growth. Excluding the impact of the assets associated with SIA, total client assets and fee-based assets increased 8% and 12%, respectively. Net flows were slightly negative in the quarter, but our recruiting pipeline remains very strong, even with competition for advisers running high. Over the prior 12 months, we've added 90 total advisers, including 28 experienced advisers with trailing production of [ $19 million. ] We increased our loan book meaningfully in the quarter as we generated nearly $1 billion in incremental fund banking loan and more than $200 million in residential mortgages. Based on part of this incremental growth and a stable NIM, in addition to the higher loan fee income in the third quarter, we expect fourth quarter net interest income to be in a range of $295 million to $305 million. As you can see on Slide 4, we have significantly grown our net interest income since the beginning of 2024 through balance sheet growth as our net interest margin has remained relatively consistent. For the year, we've already grown our loan book by roughly $3.6 billion, which is just shy of our full year guidance of $4 billion. Our strong deposit gathering capabilities continued as our combined deposit channels are up roughly $1.6 billion. Given our mix of assets and liabilities, we are relatively rate agnostic, and we've been able to maintain a consistent NIM as our funding mix has shifted. As we look forward, our ability to fund further growth is supported by approximately $2.9 billion of deposits held off balance sheet and roughly $18 billion of money market funds and $7 billion in short-term treasuries. Turning to Slide 5. Through the first 3 quarters of 2026, Institutional revenue was up 8% driven by an increase of more than 23% in investment banking. In the third quarter, the segment generated $430 million in revenue, down 14% year-on-year. In the quarter, investment banking revenue in the segment totaled $300 million, down 6% year-on-year. Advisory revenue of $173 million increased 10% sequentially, with continued strength in financials, industrials, consumer and health care. Equity capital raising revenue was $69 million, down 13% from a year ago, though issuer engagement is increasing, led by financials and health care. Fixed income underwriting revenue of $58 million was in line with last year's third quarter results. While higher interest rates weighed on new issue volume in the third quarter, fourth quarter activity is off to a strong start. We remain the #1 negotiated issue manager in public finance by deal count with more than 13% market share year-to-date. Overall, we are optimistic about investment banking as our pipelines remain very strong, we're seeing increased engagement from sponsors and improved expectations for depository M&A. Fixed income transactional revenue of $80 million was down from approximately $123 million last year, primarily due to $9 million in trading marks in the quarter as a result of the sharp move in interest rates in September and $32 million in restructuring and aircraft gains in the prior-year quarter. Equity transactional revenue was $41 million, down from $59 million a year ago primarily due to our European restructuring, lower equity volumes and approximately $7 million of trading marks in our equity facilitation inventory. Absent another rate move like September, we'd expect fourth quarter institutional transactional revenue to be in a range of $145 million to $150 million. Year-to-date, our pretax margin of 18.9% is up 530 basis points from the same period a year ago as we've meaningfully reduced our comp and noncomp ratios primarily as a result of the -- our international restructuring. Moving on to expenses. Our improved operating efficiency showed up again in a lower comp ratio for the quarter, which was our lowest since the fourth quarter of 2022. For the full year, we are projecting our comp ratio to be at the low end of our full year comp guidance. Non-compensation expenses totaled $298 million, flat with the same period a year ago, as lower provision and investment banking gross ups were offset by higher operating expenses. Our operating non-comp of 19.4% was within our full year guidance of 18% to 20%. Further, assuming a stable stock price, we expect to see a fourth quarter effective tax rate in the range of 19% to 22% based on the excess tax benefit related to stock-based compensation. Turning to Slide 7. Our capital position remains strong and provides meaningful strategic flexibility. The Tier 1 leverage ratio came in at 10.8%, while the Tier 1 risk-based capital ratio was 17% reflecting the deliberate deployment of capital into loan growth. Based on a 10% Tier 1 leverage target, we ended the quarter with nearly $360 million of excess capital, and that's after funding $1.3 billion of loan growth and buying back 1.6 million shares during the quarter. Finally, we have 6.2 million shares remaining under the current buyback authorization, assuming no additional repurchases and a stable stock price. Our fully diluted share count for the fourth quarter is expected to be approximately 158.8 million shares. And with that, Ron, back to you. Ronald J. Kruszewski: Thanks, Jim. Before I turn the call over to the operator for questions, let me comment on our outlook. In our Wealth Management segment, competition for advisers is running at elevated levels. And while our recruiting pipelines remain robust, we're staying disciplined to make sure that our growth generates the appropriate return. We believe AI will make our advisers more productive, not replace them because clients want experienced advisers and a broad set of investment options in uncertain times. Global Wealth Management has been and will continue to be the foundation of Stifel's business and its recurring revenue provides us consistent, predictable growth even in volatile markets. We're on track for another record year in this segment, remain on target to reach our goal of $1 trillion in client assets. A key component of our Wealth segment is Stifel Bank & Trust, which supports our Wealth and Institutional clients. We've significantly grown our loan and deposit gathering capabilities in recent years as we continue to execute on our long-term strategy to grow net interest income with a stable net interest margin without taking undue credit risk. Our Institutional business is a meaningful driver of top and bottom line growth in strong markets. In the third quarter, September's sharp move in rates produced trading marks on our securities inventory, which we don't expect to repeat in the fourth quarter. In advisory and capital raising, we have strong backlog and improving client engagement. And going forward, we see increased activity levels across our diversified investment bank. Putting everything together, last year's fourth quarter was an all-time record at $1.56 billion in revenue, and we expect to match it this year even with volatility that slowed what was a very strong investment banking market in the first half. We also expect earnings per share to be higher as we've kept our cost discipline and repurchased 6.8 million shares. So let me close by saying that as I look forward, I'm optimistic. We're mindful of geopolitical risk, higher interest rates and energy prices and elevated asset valuation. But healthy client engagement, strong wealth management fundamentals and an active pipeline of strategic and sponsor-led transactions give us real reason for confidence. Stifel's diversified model, recurring revenue, disciplined capital management have us positioned to keep compounding value for shareholders regardless of market conditions. Operator, with that, please open the line for the questions. Operator: [Operator Instructions] We will take our first question from Mike Brown with UBS. Michael Brown: Ron, I guess you talked a little bit about the recruitment environment. As you look at the quarter here, it looks like to us the implied growth was a little bit softer this quarter, but obviously, the environment remains very competitive. So maybe could you just touch on some of the recruitment trends you're seeing in the market today and then maybe give us kind of an update on the real-term hiring activity? You talked about the pipeline as robust. And maybe how does that compare to recent quarters? And what's your kind of view on converting that pipeline as we look at the balance of the year and into early '27? Ronald J. Kruszewski: I feel that a lot of things -- recruiting is strong, and it has been strong for us. I mean, not only over quarters, over years. I mean that it's hard to look at quarter-to-quarter. It always has been. But when I look at our recruiting numbers, outlook, what we're hearing and who we recruit, I feel very good about that business, that is very competitive. Coupled competition with a choppy market, that always slows people down. Clients get nervous, markets become more volatile. And we're -- we take a long-term view. So I get this question every quarter and every quarter, I'd say that we're a firm that we had net positive recruiting and we'll continue to do so. And I'm optimistic about who we're talking to. I would say that there's a change over the years, it's that we've probably lowered the absolute number of advisers that we talk to while increasing the trailing 12 coming in, meaning we're recruiting higher teams. And I think that's very productive and good. And finally, as I said for every quarter, I'm continually amazed at one question, [ Meow ] is going to replace all our advisers. On the second meeting I have, I talk about the recruiting competition, packages are higher than they've ever been. So -- but overall, it's a positive for us and positive for our growth rate going forward. Michael Brown: Great. Yes, certainly conflicting messages out in the market. Ron, I guess I wanted to ask about the comp ratio and the pretax margin. So very strong results this quarter. And Jim gave a guide for the year. As we think about the shift in the business mix at Stifel, you've got really strong growth in the venture and the fund finance business. You've repositioned Europe. So should we kind of view this as evidence that there's a structurally lower comp ratio at Stifel and a higher margin profile going forward? Obviously, in a normalized environment, can you kind of sustainably operate at this lower comp ratio level? Ronald J. Kruszewski: Well, look, first of all, we're going to pay our people competitively. We're going to provide -- Stifel is a place where you can do business, but we can also do well for our bankers and advisers and everyone else. And the comp ratio is a result of, frankly, driving efficiencies and not being inefficient on a number of things. So as we grow our business and become more productive, one of the things that's going to happen is it's going to lower your comp ratio. And then finally, as you -- grow our net interest income, frankly. That also drives the comp ratio. It's always at this time of the year that I'd like to point out that we're pretty consistent of not only driving the comp ratio lower throughout the year, that's generally been conservative at the beginning of the year, and we're driving shareholder returns and margin whereas oftentimes, you'll see what I always view as fourth quarter [indiscernible] comp ratio in the quarter, that is going to be much higher because we under accrue. But next year, it will be much better. And so this is very consistent. Stifel, as we go over the years, you'll see comp ratios generally decline and reach their levels -- their best levels in the fourth quarter, which often usually is our best quarter of the year. James Marischen: We'll come back next quarter and provide some more granular detail on our 2027 outlook. But given our guide that we're going to get to the lower end of the range for 2026 and you think about some of the dynamics that play into 2027, we're generating a lot of deposits today. We're having a lot of loan demand. We're going to continue to grow the bank balance sheet. We're going to continue to grow net interest income. And so that going forward is going to be the biggest driver of where the comp ratio could go. But I would say the jumping-off point of where we get to for 2026 is a good kind of thought process on how you think about that going forward in 2027. Operator: We will take our next question from Devin Ryan with Citizens Bank. Devin Ryan: Wanted to ask a question on loan growth and kind of the book broadly. Obviously, you guys are tracking really well relative to the $4 billion objective, and we all see the momentum in fund banking. So I want to dig in just a little bit more on that component. And can you talk a little bit about the growth there. How much is like cyclical, just meaning it's a good environment. There's larger draws and that can maybe bounce around versus structural with everything you're doing to bring in more clients. And as we think kind of bigger picture, like how big are you comfortable this part of the book getting to as a percentage of the overall loan book? And maybe within the strategic benefits that maybe are outside of just NII that you're seeing from growing fund banking? Ronald J. Kruszewski: Fund and venture banking together, I feel we're -- it's a sports analogy, but we're early innings into this growth rate. I talked about some of the things we need to do. Overall, the overall market, especially in fund banking, I think the market is increasing. There's a lot of money that's being raised and refinance now -- and so I see that just structurally within the market as a growing platform. Within -- our focus has been not only there, but on the venture side is to be providing technology that gets us the business to begin. And that's why we did this transaction that I mentioned, Meow Technologies. If you want to look at something similar, you'll see where Valley acquired Bluevine, and I think Brex as well was acquired. Brex? James Marischen: Capital One. Ronald J. Kruszewski: Capital One. We've taken a different approach in that we want to white label this. But when we looked at our ability to generate significant -- I'm talking about significant deposits to drive this business, we needed this technology, agentic account opening, USD, get stable and crypto back to USD, cross-border, corporate credit cards, payroll, all of these things we have what we believe is going to accelerate our ability to get clients and build this business. I've talked about in an investor call and saying we're going to be doing something on this. So this is what I was talking about. And so I'm very optimistic about this business, and it will grow faster, at least in venture, certainly faster on the deposit side, 4 to -- 5:1 in deposits. And then we deploy some of that more in fund banking where the ratios almost flip, loans to deposits. But it's a business, and we track and measure referrals to wealth, referrals to banking, mortgages that we're giving to founders, et cetera. So it is a business where we feel we bring all the capabilities and people to this segment of banking. James Marischen: The investments we've made here and not just in technology but in people, it's helped us take market share across both fund banking and on the venture space. And you think about a direct output of this, we've been talking about generating around $1 billion a quarter of deposit growth with the technology investment in Meow and the capabilities that has to offer, we should see that number increase as that goes live, and we have a more competitive treasury product. And I think that is a very scalable deposit generation channel as we look forward. Ronald J. Kruszewski: And it's across our business, all right? We -- AI, what we're talking about is being able to service clients. In this particular case, we talk about more of a narrow aspect of fund and venture banking. But when you think about what we're going to do and how we're going to grow this business, we're going to do that without opening a single branch or putting any bricks and mortar. None of this. This is all going to be incremental NII on top of what we've already built. So we've built the foundation. We just are putting some technology on it, and we're going to gain market share. Devin Ryan: Okay. I appreciate all that background. As a follow-up, I want to dig in a little bit on the investment banking commentary. Sounded, I think, relatively constructive in fourth quarter off to a good start, which is good to hear. Can you talk a little bit more about what you're seeing in the specific businesses? And like what for example, you mentioned depositories seeing additional activity. Like what do you -- what's the catalyst for that? You talk about enthusiasm into 2027. And then obviously, technology has been an area, particularly in software that's been challenged. Are you seeing that stabilize? So to any additional flavor for like what's actually happening beneath the surface that's driving activity across your businesses? And then if you can just hit on some of the sectors that we all know you have strength in. Ronald J. Kruszewski: Look, I think what happened was we had a very strong quarter and a lot of engagement, a lot of things that people are talking about and not just at Stifel, across the Street. And not just at Stifel, but across the Street, you ran into a quarter where rates, inflation rates and geopolitical all converged late August into September and that slowed activity down significantly, which is to be expected. You throw that uncertainty into the mix, add a little bit now that we're within a few weeks of an election that may change some outlook in the short run. So we've seen what I view as a financial condition induced pause, if you will, in activity. But when we look at the fact that things are getting canceled and we're not -- it's not that things are getting done because of financial conditions, I'm optimistic about the business in specific areas. We've had a slowdown in some of the health care, capital markets that we've seen. We expect that to pick up. Depository M&A, I think, as secular trends because of technology, deposit beta, the need for scale and the political realities of being able to get something done between now and '28, if there were to be a change in administration, that's going to drive activity, and we will see that change. So I think this quarter will tell a little bit more. It's off to a good start as we see it. It felt like you had to turn the calendar page out of September. But that's how it would finish. Operator: We will take our next question from Steven Chubak with Wolfe Research. Steven Chubak: Wanted to start just on sweep cash. The growth had lagged some of the metrics we had seen at your wirehouse peers, just to understand what drove some of the more pronounced declines that we saw in the quarter and your outlook for the sweep cash trajectory and just customer behavior in general as we enter a higher rate backdrop with potentially multiple hikes from the Fed? James Marischen: Right. So I'll touch on sweep cash. One item we didn't touch on this in our prepared remarks, but one thing we'd highlight. With the sale of SIA, we still kept those assets on our platform and serviced them over a period of time. So that cash was still within our ecosystem and our balances of cash. That's probably $0.5 billion that came out of our sweep balance in terms of activity in the third quarter. So I did highlight that when you're looking at the -- when we closed and fully moved those assets off our system. So the other thing I would say, just generally speaking, we typically see a seasonal uptick in deposits in the fourth quarter. We'd expect that trend to continue. We talked about other things that are going to drive deposit growth in the future. Obviously, Ron already touched on the investment in Meow, what we can do there in terms of generating additional deposits in that channel. But overall, we got nearly $3 billion of deposits available to fund future growth. We've got $18 billion sitting in money market funds. We've got $7 billion in short-term treasuries. We can go attack those and bring those. So those are all the cash and cash equivalents within our ecosystem. Now some of those things on money funds would be a little bit more -- a little bit higher cost, but those are deposits in our ecosystem that we can go get. And so we feel very comfortable overall where we're at from a deposit generation strategy and perspective. I think the other thing I'd say is, as we've seen a remix of our deposits, our NIM has been relatively stable. We've grown NII and at a stable NIM, even though we've seen this kind of reshuffle or remix of deposits. I think that fact is a little underappreciated at times. Ronald J. Kruszewski: Yes. And I would underscore that. I just -- I feel that as there's a lot of focus on a small part of our funding base, we could fund this business. We see tremendous ability to generate deposits and deploy loans and maintain a NIM. Some of the repricing that's going -- going to be on as the deposit -- just everyone knows this, it's economics as the deposit base reprices, so is the asset side going to reprice. And you're seeing it through our stable NIM, and you're going to see that throughout the industry. There's -- somehow there's a belief that you reprice cash, the industry is just going to collapse because you can't make any more net interest income. And I find that to be somewhat not consistent with economic theory. But that's for another day. Steven Chubak: Understood. And for my follow-up, I did want to ask on the brokerage commentary. So you spoke to the headwinds in the quarter. You were certainly not alone in experiencing that, especially on the muni side. You also indicated that we should see a recovery based on the guidance in transactional fees to $145 million to $150 million. Since equities is seasonally better in 4Q, it does imply continued softness in fixed income. I just wanted to better understand how much of it is structural versus cyclical and whether we could see transaction fees get back to that $160 million legacy run rate even after adjusting for some of the business exits. Ronald J. Kruszewski: Look, I think it can. I think we've been trying to say that we have -- at least in fixed income, we have transactions that we -- that are nonrecurring. That's the way I say it. They just don't seem to recur quarterly, okay? But -- so we, last quarter had almost $32 million in restructuring and aircraft. Those departments are up and running. They're doing business. The rate environment, as you can imagine, in any time you're restructuring, doing aircraft, that impacts getting something done during that quarter. So that leaves fixed income $95 million to $100 million today at run rate. We're growing that business. We're growing businesses, equities around $50 million -- I think equities tends to be more challenging, but I think we can grow. You're seeing a decline because we completely restructured Europe. But I don't -- $160 million, I mean that's a blink of an eye. That's nothing. $10 million or $40 million on a $6 billion revenue base. And we've got a lot of people. I find that to be rounding error. Operator: We will take our next question from Michael Cho with JPMorgan. Y. Cho: I just wanted to touch on the valuation slide that you put up and reminded us about. I mean, it feels like a larger deployment of capital toward -- M&A is off the table for now. I guess, one, is that fair? And then, two, I think repurchases stepped down a touch quarter-to-quarter. I get the volatility in stock price, but is there more -- maybe a more aggressive approach to buybacks that you might consider if the disconnect continues to persist? Ronald J. Kruszewski: Well, I think as it relates to your first question, yes, we're going to be very thoughtful about paying market multiples that are significant multiples of ours in terms of EBITDA and capital required to run businesses. So I just would think that, that's shareholders when they want us to look at the acquisition landscape, we want to grow, but we want to grow and be the firm that has higher than 20% ROTCE, which isn't common in the banks, certainly the bank holding company and margins that are robust. We're running this for shareholder value, not just for growth. As it relates to your second question, I think it's a good one in that when we are looking at acquisitions, there is an attractive one out there. It's called our own stock. Jim, in terms of how much we're doing, I'll leave that to you. James Marischen: Right. So the pace of buyback did decline some in the quarter. The thing I'd highlight is we did grow loans, it was $1.3 billion in the quarter in addition to buying back 1.6 million shares. So we deployed a fair amount of capital. We brought our capital ratios down. Our excess capital still stands at a strong level of about $360 million. So we have flexibility to do both, to grow the loan book as well as buy back our shares. We've got plenty of authorization left on what we currently are authorized to buy back. So you continue to see us very active on that. You just look at the share count on a year-to-date basis and get a sense of how many shares we've taken out, and it's been pretty meaningful to that number. Ronald J. Kruszewski: Yes. But that's a good point. We -- just looking at numbers, if you use a 10% leverage ratio, we could have not grown our loan book and bought back another, yes, $200-something million. But our loan growth, we think, is adding to our franchise and our return on tangible and all of that. So that's a good use of capital. Dividends is a good use of capital. The investment we made in technology, which isn't an acquisition, it was an investment, that's a great use of capital. But as an absolute acquisition of something, I just feel that if I came out and told you we're buying something at 15 to 18x EBITDA, you would not -- the Street wouldn't react well. No, we're not, but we're aligned there. Y. Cho: Fair enough. I appreciate the color. I guess just along the similar conversation around capital priorities, Ron, in the past, you talked about increasing allocation toward recruiting, I guess, in terms of dollars and resources. I mean within this conversation on capital priorities, does that also impact how you're thinking about allocating or adviser recruitment going forward? Ronald J. Kruszewski: Yes. I mean in a lot of ways, it's a different math and adviser recruiting as it relates to capital and capital ratios are -- we look at that more from a return on invested capital. We're hiring people. We're amortizing acquisition costs over 10 years, call it. And sometimes it's easy just to do that because you're kicking a lot of that expense down the road. And so you -- I'm coming up and saying, "well, based on our recruiting, our comp ratio is going up." Well, then that might signal that we're either being aggressive in recruiting or maybe we're overpaying a little bit. So -- but that's hard to see in the short run. We have done this for nearly 30 years, and we've built this firm from $100 million in revenue, and we're at $6 billion with a 24% ROTCE. And that's because we're capital disciplined. And I'm going to keep saying that. And if that means that we pass on things that don't meet our capital returns, well, the shareholders should be -- that should be a premium, not a discount to shareholder valuation, my opinion. Operator: We will take our next question from Bill Katz with TD Cowen. William Katz: Just like to stay on the FA recruiting discussion, if we could. I think you mentioned in your prepared remarks, you had negative growth in the quarter. I was wondering if you could maybe unpack that a little bit, maybe by channel, what you might be seeing, I think, Ron, you mentioned that competition is still pretty elevated. And underneath that, one of the things we're hearing is that these PE platforms are leveraging AI to really reduce the back office costs and then drive up the recruitment and TA packages. Where are you in terms of potentially including such technology in your own footprint which maybe allow you to be more competitive on pricing if needed? Ronald J. Kruszewski: Well, I think we are utilizing AI more -- productivity tools, I got something on back office and using AI tools to settle trades or something like that. I haven't seen that. But none of them are self-clearing, so that's not possible anyway. So -- but in terms of tools and being able to help advisers maybe have less assistance, I guess, that's possible. We're not taking that approach. We're using AI as a tool to help us, and it's a powerful tool for meeting prep, meeting follow-up, analysis discussion. There's a whole bunch of things. But we're combining that with humans, and I actually see the need for more people, not less. So I don't know. I don't -- just not sure if I'm in a recruiting pitch and I say, "Hey, look, I can add a little bit more of your recruiting, but you can't have an assistant because you got to use this AI bot." I think I'm going to go down in my recruiting ability. I just do. But that's just, again, the private equity firms are dealing more in the independent and RIA space. So I don't really know. But AI is clearly a productivity enhancer. We're making significant investments. We're reskinning a lot of our tools. We're putting new tools in place. And I think it's a tailwind to what we're doing. I'm not going -- we're not going to reduce people and recruit -- up recruiting, but we're not doing that now. Not now, we're just not. James Marischen: Everything within our Wealth business is also in the employee channel. I mean [ the channel of SIA, ] but we're no longer in the independent space at all. William Katz: Okay. That makes sense. And just maybe coming back to your guidance. So it seems like you're going to be south of the $6 billion number for the full year on your top line net revenue number and you guided to NII bouncing -- rising a little bit more and that you have a little bit of a recovery on the transaction side due to lack of mark-to-market and you talk to the better investment banking backlog. So can you talk a little bit about where the residual weakness might be relative to expectation at this point in time? And then how long is the lead lag between the pipeline and actually revenue recognition through the advisory line? Ronald J. Kruszewski: Yes. Well, look, let's -- I said we're going to -- we expect to have -- we had a record, record quarter in the fourth quarter that's -- we expect that to be in that range. This is still not a hugely robust environment. That can change. Let's see how the elections go and what happens after that. There are going to be a lot of repositioning of things that will happen post the election. But look, as it relates to the guide, there are a couple of things we did, a lot -- some of it is accounting. For instance, we were conservative on the sale of SIA. We recorded a $50-plus million gain on that, and we call it -- we put it noncore because we just thought that probably shouldn't be in core but we were doing it at the beginning of the year, that was in our thought process of revenue. Same with our restructuring of Europe that we were doing off run rate revenues. Both of those items increased our margins, increased our return on tangible equity, but probably took out of our run rate $70 million, $75 million of revenue. So if you add that in, you're back close to $6 billion of our range. Now why weren't we above that range? I would point -- I think we thought the fixed income would have a better year. The rate environment, everything that's happened, some of the marks we took muted those returns, but I'm optimistic about that business, too. So I feel we're at the low end of the range of what we said in January and about -- rounding. If you look -- I mean, look at our GAAP numbers, our GAAP numbers, we reported some of the revenue in GAAP and not -- we took them out of non-GAAP. Operator: We will take our next question from Brennan Hawken with BMO Capital Markets. Brennan Hawken: Ron, just start with a follow-up. I believe when you were answering Steve's question on trading, you mentioned $50 million for revenues in the -- in equities in the fourth quarter. Normally, we see a seasonal pickup. So was the seasonality that you historically have seen tied to Europe? Or is just the core operating environment softer, and so therefore, the seasonality is just not going to provide the same sort of uplift that we would normally see versus typical run rate? Ronald J. Kruszewski: When I say -- and I think this is good, and I'll let Jim go ahead, but I don't see if he disagrees with me, looks to be good. But when we say $145 million to $150 million, that's kind of our run rate absent these marks on the inventory, absent the -- we've tried to tell you isn't always recurring. So that's not necessarily the fourth quarter. That's just trying to say, look, we've got a little bit of noise here, and this is what we see settling out. The fourth quarter generally is seasonally better. We'll see that seasonality often depend on the election. We also -- we get checks for our -- the old MiFID type thing where we get research checks that always helps, too. So that wasn't meant to be just a fourth quarter look. That's just trying to reset the your all's expectations of what sort of the normal, if there is such a word, run rate in institutional transactional revenue. James Marischen: First of all, I agree with what Ron said. I'd add to that. The European restructuring has an impact on this, on what is a normalized run rate. That probably took out $5 million or $6 million of year-over-year comparison when you look at the fourth quarter. And so that's going to have an impact on that absolute number on what we did with those restructuring activities. So you have to take that in consideration when you're looking at these numbers year-over-year. Brennan Hawken: Okay. I mean the transcript does say that you'd expect fourth quarter rev, but okay, fine. Got it. Follow-up question on the Slide-2 point and some of the discussion around net new. So one thing I'd point out is that both of those comps do disclose net new assets. So that might be something to consider. Maybe -- you said that net new was helpful. Was that quarter-over-quarter, year-over-year? And if it was year-over-year, was it positive quarter-over-quarter? And then for maybe a subpart of the consideration, one part that could result in this delta in the metrics could be scale. So would you consider looking to partner to be part of a larger, more powerful, more scaled organization, potentially, which might allow for that realization and valuation to be gapped or bridged? Ronald J. Kruszewski: Did you ask -- did you just ask me [ about myself? ] Brennan Hawken: That is a very indirect way of doing it, yes. Ronald J. Kruszewski: I just give you a very direct clarification, okay? So that's -- I don't mind. Look, that's a fair question. That's just a long way of asking it, but it's a very fair question. Look, where, okay, so you -- wherever it is, we're going to -- with those 2, I don't want to say because I'm not doing anything, but most financial institutions, we're going to scale into someone that has a lower growth rate and a lower return on tangible equity. And because of scale, that don't make sense to me. If I'm going to scale, then I'm going to scale into someone that's got higher margins, higher returns, higher growth rate. So I understand a quarter can stand on its own, but we've put on that slide since 2016. So those -- check those numbers. So why -- who's growing faster? So I hear you. I -- now your question is, do we get a higher multiple even though we combine with someone with lower financial metrics? The answer is no, but I understand the question. And it's fair. I don't mean to suggest it's not a fair question. Brennan Hawken: Okay. Thanks for tolerating me. Ronald J. Kruszewski: No, that's all right. I'm going to come on your earnings call and ask the same question. So that will be fun. But no, that's fair. But what is it? Most -- and I'm just taking a moment here because most institutions that try to combine for scale in a people business and in a culture business and a business that's long and established as Stifel with our growth rate, it's not like we're not growing, we'll find out that those lead to diseconomies of scale, not economies of scale. So I'll leave you with that thought, okay? Operator: There are no further questions at this time. I will turn the conference back to Mr. Kruszewski for any additional or closing remarks. Ronald J. Kruszewski: That -- well, I mean, the -- we appreciate everyone. I really -- I want to compliment all of our analysts. I like thought-provoking questions. I like questions that I want people to be comfortable asking. I want you also be comfortable in my answers if you ask the questions, but I really do appreciate the fact that our analyst community takes the time to think about things that are outside the box. And to our shareholders, what I would say is that our business model at Stifel really can be put almost in -- its 3 buckets. First and foremost, we want to serve our clients, and we want to put all our resources to providing the best products, services and advice that we can on the table. The benefit of serving our clients well falls into 2 buckets. One, that our associates and partners can do well. And the second is that our shareholders -- not second, but equally, our shareholders do well. And that's how we manage the play. So we do not manage it to maximize employees at the expense of shareholders. And frankly, we're not going to maximize shareholders at the expense of employees. Both of those are not good long-term ways to run a human capital financial services firm. But with that, I look forward to reporting in the fourth quarter, and thank you for your time. Operator: This concludes today's call. Thank you for your participation. You may now disconnect. Before you buy stock in Stifel Financial, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Stifel Financial wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $370,440!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,330,110!* Now, it's worth noting Stock Advisor's total average return is 924% — a market-crushing outperformance compared to 212% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors. See the 10 stocks » *Stock Advisor returns as of October 21, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Stifel (SF) Q3 2026 Earnings Call Transcript was originally published by The Motley Fool

- Interested in Stifel Financial Corporation? Here are five stocks we like better. - Stifel reported record third-quarter EPS of $1.46, up 12% year over year, on $1.43 billion in net revenue. Management said the firm remains on track for another record year, with year-to-date revenue up 9% and EPS up 57%. - Global Wealth Management reached record revenue of $980 million, supported by higher asset-management revenue, net interest income and growth in client assets and fee-based assets. Loan growth also lifted net interest income to $302 million, above guidance. - Institutional revenue fell 14% to $430 million as market volatility and September rate moves hurt transactional revenue, though advisory revenue improved sequentially. Stifel expects fourth-quarter revenue to match the prior-year record and EPS to exceed the year-earlier period. - Can ServisFirst Keep Delivering? Stifel Financial (NYSE:SF) reported third-quarter results that included record earnings per share for the period, supported by growth in its Global Wealth Management business, higher net interest income and expense discipline that offset weaker transactional revenue in its institutional segment. Chairman and Chief Executive Officer Ron Kruszewski said the firm remains on track for another record year. Through the first nine months of 2026, Stifel generated revenue of $4.3 billion, up 9% from a year earlier, while earnings per share rose 57% to $4.33. Excluding the impact of a legal charge recorded in the prior year, year-to-date EPS increased 22%, he said. → The AI Sell-Off Continues—These 3 Stocks Keep Raising Guidance Anyway - MGM Buyout: The House Doesn't Always Win For the third quarter, Stifel posted non-GAAP earnings per share of $1.46, up 12% year over year, on net revenue of $1.43 billion. The company's pre-tax margin was 22.5%, while its compensation ratio declined to 56.6%, the lowest level since the fourth quarter of 2022. Global Wealth Management generated record net revenue of $980 million in the third quarter, up 8% from the prior-year period. Chief Financial Officer Jim Marischen said the performance reflected record asset-management revenue and a record third-quarter contribution from net interest income, partly offset by lower transactional revenue. → Tesla's Roadster Reveal Hints at 2 Much Bigger Moves - MarketBeat Week in Review – 03/16 - 03/20 Stifel ended the quarter with $576 billion in total client assets and $240 billion in fee-based assets, increases of 6% and 9%, respectively. Excluding assets associated with SIA, total client assets increased 8% and fee-based assets rose 12%, aided by equity-market appreciation and net new asset growth. Net flows were slightly negative during the quarter, though management said advisor recruiting remained a source of confidence. Over the past 12 months, the firm added 90 advisors, including 28 experienced advisors with $19 million of trailing production. → Luxury's Middle Market Is Cracking—These 3 Stocks Could Win Kruszewski said Stifel is focusing on recruiting larger teams rather than expanding the absolute number of advisors it engages with. He described the recruiting market as highly competitive but said the company has continued to achieve net positive recruitment over time. "We're a firm that we have net positive recruiting and we'll continue to do so," Kruszewski said. "I'm optimistic about who we're talking to." Stifel increased loans by $1.3 billion in the third quarter, including nearly $1 billion in incremental fund-banking loans and more than $200 million in residential mortgages. For the year to date, the loan book has expanded by roughly $3.6 billion, approaching the company's full-year target of $4 billion. Net interest income reached $302 million, above the high end of the company's guidance and near its highest quarterly level, Marischen said. The result was driven by loan growth and higher loan-fee income. Stifel expects fourth-quarter net interest income of $295 million to $305 million. The company said its net interest margin has remained relatively stable as its balance sheet has grown. Stifel cited approximately $2.9 billion of deposits held off balance sheet, roughly $18 billion in money-market funds and $7 billion in short-term Treasuries as potential sources to support additional funding needs. Stifel also disclosed a strategic investment in Meow Technologies and a long-term licensing agreement that will provide the firm access to the fintech company's current and future platform capabilities. Kruszewski said the arrangement will support a white-label treasury-management platform for venture-fund banking and commercial clients. Management said the technology investment is intended to accelerate Stifel's venture and fund banking platform, broaden capabilities for institutional and wealth clients, and help generate deposits without adding branches or physical infrastructure. Institutional revenue totaled $430 million in the third quarter, down 14% from a year earlier. Investment banking revenue was $300 million, down 6%, though advisory revenue rose 10% sequentially to $173 million, supported by activity in financials, industrials, consumer and healthcare. Equity capital-raising revenue was $69 million, down 13% year over year, while fixed-income underwriting revenue of $58 million was in line with the prior-year quarter. Stifel said higher rates weighed on new-issue volume during the quarter, although fourth-quarter activity had begun strongly. Fixed-income transactional revenue fell to $80 million from approximately $123 million a year earlier. Marischen attributed the decline partly to $9 million in trading marks resulting from sharp interest-rate moves in September, as well as $32 million in restructuring and aircraft gains recorded in the prior-year period. Equity transactional revenue declined to $41 million from $59 million, reflecting the company's European restructuring, lower equity volumes and about $7 million of marks on equity facilitation inventory. Absent another rate move similar to September's, Stifel expects fourth-quarter institutional transactional revenue in a range of $145 million to $150 million. The company's institutional pre-tax margin for the first nine months of the year was 18.9%, up 530 basis points from the year-earlier period, reflecting lower compensation and non-compensation ratios following the international restructuring. Stifel repurchased 1.6 million shares during the quarter and had 6.2 million shares remaining under its current authorization. Its Tier 1 leverage ratio was 10.8%, and management estimated excess capital of nearly $360 million based on a 10% leverage target, after loan growth and buybacks. Kruszewski said the company expects to match its record fourth-quarter 2025 revenue of $1.56 billion, despite market volatility that slowed what he characterized as a strong investment-banking environment earlier in the year. He also expects fourth-quarter earnings per share to exceed the prior-year period, citing cost discipline and the effect of 6.8 million shares repurchased. Management said it remains mindful of geopolitical risks, higher interest rates, energy prices and elevated asset valuations. Still, Kruszewski pointed to wealth-management fundamentals, client engagement, investment-banking backlogs and sponsor-led transaction activity as reasons for confidence heading into the final quarter. Stifel Financial Corp. is a financial services holding company headquartered in St. Louis, Missouri. Through its principal operating subsidiaries, including Stifel, Nicolaus & Company, Incorporated, the company provides wealth management, investment banking, securities brokerage and related financial services to individual investors, corporations, municipalities and institutional clients. Its wealth management business offers investment advice, brokerage services, financial planning, banking and lending solutions, and access to a range of investment products. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "What Stifel Financial (SF) Said on Its Q3 Earnings Call" was originally published by MarketBeat. View MarketBeat's top stocks for October 2026.

Stifel Financial (SF) came out with quarterly earnings of $1.46 per share, beating the Zacks Consensus Estimate of $1.43 per share. This compares to earnings of $1.3 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +2.10%. A quarter ago, it was expected that this brokerage and investment banking firm would post earnings of $1.35 per share when it actually produced earnings of $1.42, delivering a surprise of +5.19%. Over the last four quarters, the company has surpassed consensus EPS estimates four times. Stifel, which belongs to the Zacks Financial - Investment Bank industry, posted revenues of $1.43 billion for the quarter ended September 2026, missing the Zacks Consensus Estimate by 1.59%. This compares to year-ago revenues of $1.43 billion. The company has topped consensus revenue estimates three times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Stifel shares have lost about 20% since the beginning of the year versus the S&P 500's gain of 12.7%. While Stifel has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Stifel was unfavorable. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #4 (Sell) for the stock. So, the shares are expected to underperform the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $1.93 on $1.55 billion in revenues for the coming quarter and $6.17 on $5.96 billion in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Financial - Investment Bank is currently in the top 24% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. One other stock from the same industry, Robinhood Markets, Inc. (HOOD), is yet to report results for the quarter ended September 2026. The results are expected to be released on October 27. This company is expected to post quarterly earnings of $0.55 per share in its upcoming report, which represents a year-over-year change of -9.8%. The consensus EPS estimate for the quarter has been revised 1% higher over the last 30 days to the current level. Robinhood Markets, Inc.'s revenues are expected to be $1.42 billion, up 11.4% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Stifel Financial Corporation (SF) : Free Stock Analysis Report Robinhood Markets, Inc. (HOOD) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

ST. LOUIS, Oct. 21, 2026 (GLOBE NEWSWIRE) -- Stifel Financial Corp. (NYSE: SF) today reported net revenues of $1.43 billion for the three months ended September 30, 2026, compared with $1.43 billion a year ago. Net income available to common shareholders was $224.8 million, or $1.40 per diluted common share, compared with $202.1 million, or $1.22 per diluted common share (1) for the third quarter of 2025. Non-GAAP net income available to common shareholders was $234.1 million, or $1.46 per diluted common share for the third quarter of 2026. Ronald J. Kruszewski, Chairman and Chief Executive Officer, said "Stifel is on track for another record year, with year-to-date revenue of $4.3 billion up 9%, core earnings per share of $4.33 up 22%, and return on tangible common equity of 24.1%. The investments we've made in our business continued to drive operating efficiencies, as we delivered our highest ever third quarter earnings per share of $1.46, up 12% versus the prior year, on net revenue of $1.43 billion. I am optimistic about our outlook, as Stifel's diversified business model, recurring revenue stream, and disciplined capital management position us to keep compounding value for shareholders." Highlights - The Company reported net revenues of $1.43 billion, the second best third quarter in its history, driven by higher asset management revenues and net interest income. - Non-GAAP net income available to common shareholders of $1.46 per diluted common share, the best third quarter in its history. - Asset management revenues increased 14% over the year-ago quarter. - Net interest income increased 9% over the year ago quarter. - Bank loans increased 21% over the year ago quarter. - Client assets of $576.5 billion, up 6% over the year-ago quarter. - Over the last twelve months, recruited trailing twelve-month production totaled approximately $19 million. - Non-GAAP pre-tax margin of 22.5%. - Annualized return on tangible common equity (ROTCE) (6) of 23.9%. - Tangible book value per common share (9) of $26.05, up 12% from prior year. - The Company repurchased $124.0 million, or 1.6 million shares, of its outstanding common stock during the third quarter at an average price of $76.95. - Announced strategic investment in Meow Technologies. Financial Summary (Unaudited) (000s) | 3Q 2026 | 3Q 2025 | 9m 2026 | 9m 2025 GAAP Financial Highlights: | | | Net revenues | $1,426,211 | | $1,429,396 | | $4,355,176 | | $3,969,151 | Net income(2) | $224,823 | | $202,051 | | $684,078 | | $391,457 | Diluted EPS(1) (2) | $1.40 | | $1.22 | | $4.23 | | $2.37 | Comp. ratio | | 57.0% | | | 58.8% | | | 57.3% | | | 59.1% | Non-comp. ratio | | 21.3% | | | 21.2% | | | 21.2% | | | 26.7% | Pre-tax margin | | 21.7% | | | 20.0% | | | 21.5% | | | 14.2% | Non-GAAP Financial Highlights: | | | Net revenues | $1,429,077 | | $1,429,398 | | $4,323,903 | | $3,969,231 | Net income(2)(3) | $234,096 | | $214,419 | | $700,872 | | $454,281 | Diluted EPS(1) (2) (3) | $1.46 | | $1.30 | | $4.33 | | $2.76 | Comp. ratio(3) | | 56.6% | | | 58.0% | | | 57.0% | | | 58.0% | Non-comp. ratio(3) | | 20.9% | | | 20.8% | | | 20.9% | | | 25.9% | Pre-tax margin(4) | | 22.5% | | | 21.2% | | | 22.1% | | | 16.1% | ROCE(5) | | 17.4% | | | 17.0% | | | 17.5% | | | 12.2% | ROTCE(6) | | 23.9% | | | 24.3% | | | 24.1% | | | 17.3% | Global Wealth Management (assets and loans in millions) | Net revenues | $980,293 | | $907,440 | | $2,868,950 | | $2,603,630 | Pre-tax net income | $374,408 | | $342,650 | | $1,066,970 | | $775,111 | Total client assets(7) | $576,482 | | $544,010 | | | Fee-based client assets(7) | $239,661 | | $219,178 | | | Bank loans(8) | $26,065 | | $21,635 | | | Institutional Group | | | | Net revenues | $430,281 | $500,435 | $1,406,233 | $1,305,143 Equity | $282,574 | $296,677 | $915,506 | $753,037 Fixed Income | $147,707 | $203,758 | $490,727 | $552,106 Pre-tax net income | $76,261 | $89,291 | $266,348 | $177,762 | | | | | | | | Global Wealth Management Global Wealth Management reported record net revenues of $980.3 million for the three months ended September 30, 2026, compared with $907.4 million during the third quarter of 2025. Pre-tax net income was $374.4 million compared with $342.7 million in the third quarter of 2025. Highlights - Client assets of $576.5 billion, up 6% over the year-ago quarter, which included $10.2 billion of client assets from the Stifel Independent Advisors business that was sold on February 2, 2026. - Fee-based client assets of $239.7 billion, up 9% over the year-ago quarter, which included $4.8 billion of client assets from the Stifel Independent Advisors business that was sold on February 2, 2026. - Over the last twelve months, recruited trailing twelve-month production totaled approximately $19 million. Net revenues increased 8% from a year ago: - Transactional revenues decreased 3% over the year-ago quarter, reflecting a decrease in client activity. - Asset management revenues increased 14% over the year-ago quarter, reflecting higher asset values due to improved market conditions and net new asset growth. - Net interest income increased 11% over the year-ago quarter primarily driven by balance sheet growth, partially offset by lower interest rates. Total Expenses: - Compensation expense as a percentage of net revenues increased modestly to 48.8% primarily driven by higher revenue-related compensation, partially offset by revenue growth. - Provision for credit losses decreased from a year ago primarily as a result of a modest improvement in macroeconomic conditions, partially offset by loan growth in the retained portfolio and specific reserves on individual credits. - Non-compensation operating expenses as a percentage of net revenues decreased to 13.0% primarily attributable to lower litigation-related expenses, a decrease in the provision for credit losses, and revenue growth over the year-ago quarter. Summary Results of Operations | | | | | (000s) | | 3Q 2026 | | 3Q 2025 | Net revenues | $980,293 | $907,440 | Transactional revenues | | 196,213 | | 203,078 | Asset management | | 492,123 | | 431,363 | Net interest income | | 284,583 | | 257,327 | Investment banking | | 6,731 | | 6,529 | Other income | | 643 | | 9,143 | Total expenses | $605,885 | | $564,790 | Compensation expense | | 478,877 | | | 441,626 | Provision for credit losses | | 7,926 | | | 8,316 | Non-comp. operating expenses | | 119,082 | | | 114,848 | Pre-tax net income | $374,408 | | $342,650 | Compensation ratio | | 48.8% | | | 48.7% | Non-compensation ratio | | 13.0% | | | 13.5% | Pre-tax margin | | 38.2% | | | 37.8% | | | | | | | Institutional Group Institutional Group reported net revenues of $430.3 million for the three months ended September 30, 2026, compared with $500.4 million during the third quarter of 2025. Pre-tax net income was $76.3 million compared with $89.3 million in the third quarter of 2025. Highlights Investment banking revenues decreased 6% from a year ago: - Advisory revenues decreased 4% from the year-ago quarter, driven by lower levels of completed advisory transactions. - Equity capital raising revenues decreased 13% from the year-ago quarter, driven by lower volumes and smaller deal sizes. - Fixed income capital raising revenues decreased 2% over the year-ago quarter primarily driven by lower bond issuances. Fixed income transactional revenues decreased 34% from a year ago: - Fixed income transactional revenues were impacted by widening credit spreads, increased market volatility, and lower realized trading gains during the quarter. Equity transactional revenues decreased 29% from a year ago: - Equity transactional revenues were impacted by lower realized trading gains, a decline in trading volumes over the year-ago quarter and the restructuring of our European Equities business, which resulted in a $7 million reduction in equity transactional revenues year over year. Total Expenses: - Compensation expense as a percentage of net revenues decreased to 58.7% primarily attributable to lower revenue-related compensation due to a decline in revenues from the year ago quarter. - Non-compensation operating expenses as a percentage of net revenues increased to 23.6% primarily attributable to a decline in revenues from the year ago quarter. Summary Results of Operations (000s) | | 3Q 2026 | | | 3Q2025 | Net revenues | $430,281 | | $500,435 | Investment banking | | 299,472 | | | 316,954 | Advisory | | 173,017 | | | 179,270 | Equity capital raising | | 68,556 | | | 78,765 | Fixed income capital raising | | 57,899 | | | 58,919 | Fixed income transactional | | 80,472 | | | 122,567 | Equity transactional | | 41,195 | | | 58,306 | Other | | 9,142 | | | 2,608 | Total expenses | $354,020 | | $411,144 | Compensation expense | | 252,656 | | | 297,106 | Non-comp. operating expenses | | 101,364 | | | 114,038 | Pre-tax net income | $76,261 | | $89,291 | Compensation ratio | | 58.7% | | | 59.4% | Non-compensation ratio | | 23.6% | | | 22.8% | Pre-tax margin | | 17.7% | | | 17.8% | | | | | | | Other Matters Highlights - Total assets increased $3.6 billion, or 9%, from the year-ago quarter. - Over the last twelve months, the Company repurchased $564.4 million, or 7.3 million shares, of its outstanding common stock at an average price of $77.05. - Weighted average diluted shares outstanding decreased primarily due to share repurchases. - The Board of Directors declared a $0.34 quarterly dividend per share, payable on September 15, 2026, to common shareholders of record on September 1, 2026. - The Board of Directors declared a quarterly dividend on the outstanding shares of the Company's preferred stock, payable on September 15, 2026, to shareholders of record on September 1, 2026. | 3Q 2026 | | 3Q 2025 | Common stock repurchases(1) | | Repurchases (000s) | $124,005 | | $33,086 | Number of shares (000s) | | 1,612 | | | 438 | Average price | $76.95 | | $75.57 | Period end shares (000s) | | 150,061 | | | 152,922 | Weighted average diluted shares outstanding (000s) | | 160,145 | | | 165,087 | Effective tax rate | | 24.4% | | | 26.1% | Stifel Financial Corp.(10) | | Tier 1 common capital ratio | `14.5% | | 14.8% | Tier 1 risk-based capital ratio | | 17.0% | | | 17.6% | Tier 1 leverage capital ratio | | 10.8% | | | 11.1% | Tier 1 capital (MM) | $4,665 | | $4,267 | Risk weighted assets (MM) | $27,450 | | $24,235 | Average assets (MM) | $43,060 | | $38,332 | Quarter end assets (MM) | $45,282 | | $41,687 | Agency | Rating | Outlook Fitch Ratings | BBB+ | Stable S&P Global Ratings | BBB | Stable | | Conference Call Information Stifel Financial Corp. will host its third quarter 2026 financial results conference call on Wednesday, October 21, 2026, at 9:30 a.m. Eastern Time. The conference call may include forward-looking statements. All interested parties are invited to listen to Stifel's Chairman and CEO, Ronald J. Kruszewski, by dialing (800) 330-6710 and referencing conference ID 9806728. A live audio webcast of the call, as well as a presentation highlighting the Company's results, will be available through the Company's web site, www.stifel.com. For those who cannot listen to the live broadcast, a replay of the broadcast will be available through the above-referenced web site beginning approximately one hour following the completion of the call. Company Information Stifel Financial Corp. (NYSE: SF) is a diversified financial services firm providing wealth management, commercial and investment banking, trading, and research services to individuals, institutions, and municipalities. Founded in 1890 and headquartered in St. Louis, Missouri, the firm operates more than 400 offices across the United States and in major global financial centers. As a firm where success meets success, Stifel works closely with retail and institutional clients aiming to transform opportunities into achievement. To learn more about Stifel, please visit the Company's website at www.stifel.com. For global disclosures, please visit www.stifel.com/investor-relations/press-releases. A financial summary follows. Financial, statistical and business-related information, as well as information regarding business and segment trends, is included in the financial supplement. Both the earnings release and the financial supplement are available online in the Investor Relations section at www.stifel.com/investor-relations. The information provided herein and in the financial supplement, including information provided on the Company's earnings conference calls, may include certain non-GAAP financial measures. The definition of such measures or reconciliation of such measures to the comparable U.S. GAAP figures are included in this earnings release and the financial supplement, both of which are available online in the Investor Relations section at www.stifel.com/investor-relations. Cautionary Note Regarding Forward-Looking Statements This earnings release contains certain statements that may be deemed to be "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements in this earnings release not dealing with historical results are forward-looking and are based on various assumptions. The forward-looking statements in this earnings release are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in or implied by the statements. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements include, among other things, the following possibilities: the ability to successfully integrate acquired companies or the branch offices and financial advisors; a material adverse change in financial condition; the risk of borrower, depositor, and other customer attrition; a change in general business and economic conditions; changes in the interest rate environment, deposit flows, loan demand, real estate values, and competition; changes in accounting principles, policies, or guidelines; changes in legislation and regulation; other economic, competitive, governmental, regulatory, geopolitical, and technological factors affecting the companies' operations, pricing, and services; and other risk factors referred to from time to time in filings made by Stifel Financial Corp. with the Securities and Exchange Commission. For information about the risks and important factors that could affect the Company's future results, financial condition and liquidity, see "Risk Factors" in Part I, Item 1A of the Company's Annual Report on Form 10-K for the year ended December 31, 2025. Forward-looking statements speak only as to the date they are made. The Company disclaims any intent or obligation to update forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made. Summary Results of Operations (Unaudited) | | | | Three Months Ended | | Nine Months Ended (000s, except per share amounts) | 9/30/2026 | 9/30/2025 | % Change | 6/30/2026 | % Change | 9/30/2026 | 9/30/2025 | % Change Revenues: | | | | | | | | Commissions | $200,756 | $206,075 | (2.6) | | $221,462 | (9.3) | | $630,052 | $600,414 | 4.9 | Principal transactions | | 117,124 | | 177,876 | (34.2) | | | 140,091 | (16.4) | | | 407,436 | | 492,139 | (17.2) | Investment banking | | 306,203 | | 323,483 | (5.3) | | | 331,954 | (7.8) | | | 979,569 | | 794,885 | 23.2 | Asset management | | 492,163 | | 431,399 | 14.1 | | | 456,630 | 7.8 | | | 1,408,250 | | 1,244,548 | 13.2 | Other income | | 8,299 | | 14,228 | (41.7) | | | 12,549 | (33.9) | | | 76,527 | | 28,499 | 168.5 | Operating revenues | | 1,124,545 | | 1,153,061 | (2.5) | | | 1,162,686 | (3.3) | | | 3,501,834 | | 3,160,485 | 10.8 | Interest revenue | | 510,624 | | 481,504 | 6.0 | | | 476,093 | 7.3 | | | 1,437,766 | | 1,434,192 | 0.2 | Total revenues | | 1,635,169 | | 1,634,565 | 0.0 | | | 1,638,779 | (0.2) | | | 4,939,600 | | 4,594,677 | 7.5 | Interest expense | | 208,958 | | 205,169 | 1.8 | | | 187,975 | 11.2 | | | 584,424 | | 625,526 | (6.6) | Net revenues | | 1,426,211 | | 1,429,396 | (0.2) | | | 1,450,804 | (1.7) | | | 4,355,176 | | 3,969,151 | 9.7 | Non-interest expenses: | | | | | | | | Compensation and benefits | | 813,494 | | 839,820 | (3.1) | | | 833,018 | (2.3) | | | 2,494,846 | | 2,346,976 | 6.3 | Non-compensation operating expenses | | 303,092 | | 303,530 | (0.1) | | | 318,348 | (4.8) | | | 925,195 | | 1,058,945 | (12.6) | Total non-interest expenses | | 1,116,586 | | 1,143,350 | (2.3) | | | 1,151,366 | (3.0) | | | 3,420,041 | | 3,405,921 | 0.4 | Income before income taxes | | 309,625 | | 286,046 | 8.2 | | | 299,438 | 3.4 | | | 935,135 | | 563,230 | 66.0 | Provision for income taxes | | 75,482 | | 74,675 | 1.1 | | | 72,961 | 3.5 | | | 223,096 | | 143,812 | 55.1 | Net income | | 234,143 | | 211,371 | 10.8 | | | 226,477 | 3.4 | | | 712,039 | | 419,418 | 69.8 | Preferred dividends | | 9,320 | | 9,320 | 0.0 | | | 9,321 | (0.0) | | | 27,961 | | 27,961 | 0.0 | Net income available to common shareholders | $224,823 | $202,051 | 11.3 | | $217,156 | 3.5 | | $684,078 | $391,457 | 74.8 | Earnings per common share:(1) | | | | | | | Basic | $1.48 | $1.31 | 13.0 | | $1.41 | 5.0 | | $4.45 | $2.52 | 76.6 | Diluted | $1.40 | $1.22 | 14.8 | | $1.34 | 4.5 | | $4.23 | $2.37 | 78.5 | Cash dividends declared per common share(1) | $0.34 | $0.31 | 9.7 | | $0.34 | 0.0 | | $1.02 | $0.93 | 9.7 | Weighted average number of common shares outstanding:(1) | | | | | Basic | | 151,956 | | 154,679 | (1.8) | | | 154,234 | (1.5) | | | 153,889 | | 155,603 | (1.1) | Diluted | | 160,145 | | 165,087 | (3.0) | | | 161,631 | (0.9) | | | 161,744 | | 164,877 | (1.9) | | | | | | | | | | | | | | | | | Non-GAAP Financial Measures (11) | | | Three Months Ended | Nine Months Ended (000s, except per share amounts) | 9/30/2026 | 9/30/2025 | 9/30/2026 | 9/30/2025 GAAP net income | | 234,143 | | $ | 211,371 | | | 712,039 | | $ | 419,418 | Preferred dividend | | 9,320 | | | 9,320 | | | 27,961 | | | 27,961 | Net income available to common shareholders | | 224,823 | | | 202,051 | | | 684,078 | | | 391,457 | | | | | Non-GAAP adjustments: | | | | Net revenue adjustments (12) (13) | | 2,866 | | | 2 | | | (31,273 | ) | | 80 | Merger-related (14) | | 8,219 | | | 12,676 | | | 50,090 | | | 45,635 | Restructuring and severance (15) | | 1,174 | | | 4,065 | | | 3,504 | | | 31,106 | Provision for income taxes (16) | | (2,986 | ) | | (4,375 | ) | | (5,527 | ) | | (13,997 | ) Total non-GAAP adjustments | | 9,273 | | | 12,368 | | | 16,794 | | | 62,824 | Non-GAAP net income available to common shareholders | $ | 234,096 | | $ | 214,419 | | $ | 700,872 | | $ | 454,281 | | | | | Weighted average diluted shares outstanding (1) | | 160,145 | | | 165,087 | | | 161,744 | | | 164,877 | | | | | GAAP earnings per diluted common share (1) | $ | 1.46 | | $ | 1.28 | | $ | 4.41 | | $ | 2.53 | Non-GAAP adjustments (1) | | 0.06 | | | 0.08 | | | 0.10 | | | 0.39 | Non-GAAP earnings per diluted common share (1) | $ | 1.52 | | $ | 1.36 | | $ | 4.51 | | $ | 2.92 | | | | | GAAP earnings per diluted common share available to common shareholders (1) | $ | 1.40 | | $ | 1.22 | | $ | 4.23 | | $ | 2.37 | Non-GAAP adjustments (1) | | 0.06 | | | 0.08 | | | 0.10 | | | 0.39 | Non-GAAP earnings per diluted common share available to common shareholders (1) | $ | 1.46 | | $ | 1.30 | | $ | 4.33 | | $ | 2.76 | | | | | | | | | | | | | GAAP to Non-GAAP Reconciliation (11) | | | Three Months Ended | Nine Months Ended (000s) | 9/30/2026 | 9/30/2025 | 9/30/2026 | 9/30/2025 GAAP net revenues | $1,426,211 | | $1,429,396 | | $4,355,176 | | $3,969,151 | Non-GAAP adjustments: | | | | Gain on sale of business (12) | | 2,866 | | | — | | | (44,418 | ) | | — | Litigation-related and other (13) | | — | | | 2 | | | 13,145 | | | 80 | Total non-GAAP adjustments | | 2,866 | | | 2 | | | (31,273 | ) | | 80 | Non-GAAP net revenues | $1,429,077 | | $1,429,398 | | $4,323,903 | | $3,969,231 | | | | | GAAP compensation and benefits | $813,494 | | $839,820 | | $2,494,846 | | $2,346,976 | As a percentage of net revenues | | 57.0% | | | 58.8% | | | 57.3% | | | 59.1% | Non-GAAP adjustments: | | | | Merger-related (14) | | (3,463 | ) | | (6,704 | ) | | (25,226 | ) | | (13,706 | ) Restructuring and severance (15) | | (1,174 | ) | | (4,065 | ) | | (3,504 | ) | | (31,106 | ) Total non-GAAP adjustments | | (4,637 | ) | | (10,769 | ) | | (28,730 | ) | | (44,812 | ) Non-GAAP compensation and benefits | $808,857 | | $829,051 | | $2,466,116 | | $2,302,164 | As a percentage of non-GAAP net revenues | | 56.6% | | | 58.0% | | | 57.0% | | | 58.0% | | | | | GAAP non-compensation expenses | $303,092 | | $303,530 | | $925,195 | | $1,058,945 | As a percentage of net revenues | | 21.3% | | | 21.2% | | | 21.2% | | | 26.7% | Non-GAAP adjustments: | | | | Merger-related (14) | | (4,756 | ) | | (5,972 | ) | | (24,864 | ) | | (31,929 | ) Non-GAAP non-compensation expenses | $298,336 | | $297,558 | | $900,331 | | $1,027,016 | As a percentage of non-GAAP net revenues | | 20.9% | | | 20.8% | | | 20.9% | | | 25.9% | Total adjustments before income taxes | $12,259 | | $16,743 | | $22,321 | | $76,821 | | | | | | | | | | | | | Footnotes | (1) | All share and per share information has been retroactively adjusted to reflect the February 2026 three-for-two stock split. (2) | Represents available to common shareholders. (3) | Reconciliations of the Company's GAAP results to these non-GAAP measures are discussed within and under "Non-GAAP Financial Measures" and "GAAP to Non-GAAP Reconciliation." (4) | Non-GAAP pre-tax margin is calculated by adding total merger-related expenses (non-GAAP adjustments) and dividing it by non-GAAP net revenues. See "Non-GAAP Financial Measures" and "GAAP to Non-GAAP Reconciliation." (5) | Return on average common equity ("ROCE"), a non-GAAP financial measure, is calculated by dividing full year or annualized net income applicable to common shareholders by average common shareholders' equity. (6) | Return on average tangible common equity ("ROTCE"), a non-GAAP financial measure, is calculated by dividing full year or annualized net income applicable to common shareholders by average tangible common equity. Tangible common equity, also a non-GAAP financial measure, equals total common shareholders' equity less goodwill and identifiable intangible assets and the deferred taxes on goodwill and intangible assets. Average deferred taxes on goodwill and intangible assets were $95.0 million and $87.2 million as of September 30, 2026, and 2025, respectively. (7) | Total client assets and fee-based client assets as of September 30, 2025, include $10.2 billion and $4.8 billion, respectively, of client assets from the Stifel Independent Advisors business that was sold on February 2, 2026. (8) | Includes loans held for sale. (9) | Tangible book value per common share, a non-GAAP financial measure, represents shareholders' equity (excluding preferred stock) divided by period end common shares outstanding. Tangible common shareholders' equity equals total common shareholders' equity less goodwill and identifiable intangible assets and the deferred taxes on goodwill and intangible assets. (10) | Capital ratios are estimates at the time of the Company's earnings release, October 21, 2026. (11) | The Company prepares its Consolidated Financial Statements using accounting principles generally accepted in the United States (U.S. GAAP). The Company may disclose certain "non-GAAP financial measures" during its earnings releases, earnings conference calls, financial presentations and otherwise. The Securities and Exchange Commission defines a "non-GAAP financial measure" as a numerical measure of historical or future financial performance, financial position, or cash flows that is subject to adjustments that effectively exclude, or include, amounts from the most directly comparable measure calculated and presented in accordance with U.S. GAAP. Non-GAAP financial measures disclosed by the Company are provided as additional information to analysts, investors and other stakeholders in order to provide them with greater transparency about, or an alternative method for assessing the Company's financial condition or operating results. These measures are not in accordance with, or a substitute for U.S. GAAP, and may be different from or inconsistent with non-GAAP financial measures used by other companies. Whenever the Company refers to a non-GAAP financial measure, it will also define it or present the most directly comparable financial measure calculated and presented in accordance with U.S. GAAP, along with a reconciliation of the differences between the non-GAAP financial measure it references and such comparable U.S. GAAP financial measure. (12) | Gain recognized on the sale of Stifel Independent Advisors, LLC during the first quarter of 2026. (13) | Primarily related to prejudgment interest recognized on legal matters. (14) | Primarily related to charges attributable to integration-related activities, signing bonuses, amortization of restricted stock awards, debentures, and promissory notes issued as retention, additional earn-out expense, and amortization of intangible assets acquired. These costs were directly related to acquisitions of certain businesses and are not representative of the costs of running the Company's on-going business. (15) | The Company recorded severance costs associated with workforce reductions in certain of its foreign subsidiaries. (16) | Primarily represents the Company's effective tax rate for the period applied to the non-GAAP adjustments. | Media Contact: Neil Shapiro (212) 271-3447 | Investor Contact: Joel Jeffrey (212) 271- 3610 | www.stifel.com/investor-relations

This article first appeared on GuruFocus. - Year-to-Date Revenue: $4.3 billion, up 9% year-over-year. - Year-to-Date EPS: $4.33, up 57% (up 22% excluding prior-year legal charge). - Return on Tangible Common Equity: 24.1% year-to-date; over 26% on a trailing 12-month basis. - Q3 EPS: Record third-quarter EPS of $1.46, up 12% year-over-year, ahead of consensus. - Q3 Net Revenue: $1.43 billion, flat year-over-year and 1% below consensus. - Q3 Pre-Tax Margin: 22.5%, driven by improved operating leverage. - Compensation Ratio: 56.6%, lowest since Q4 2022; improved from 57% in Q2. - Non-Compensation Expenses: $298 million, flat year-over-year; down 4% sequentially and 3% below consensus. - Operating Non-Comp Ratio: 19.4%, within full-year guidance of 18%20%. - Effective Tax Rate: 24.4%, slightly below consensus; Q4 expected at 19%22%. - Investment Banking Revenue: Exceeded expectations by $12 million (4%); advisory and underwriting both above Street expectations. - Net Interest Income: $302 million, above high end of guidance and $4 million above consensus; Q4 guidance of $295 million$305 million. - Transactional Revenue: Down 17% year-over-year and 10% below expectations. - Asset Management Revenue: Up 14% year-over-year on market appreciation and net new asset growth. - Global Wealth Management Revenue: Record net revenue of $980 million, up 8% year-over-year. - Client Assets: Total client assets of $576 billion (up 6%); fee-based assets of $240 billion (up 9%). - Advisor Growth: Added 90 total advisors over prior 12 months, including 28 experienced advisors with trailing production of $19 million. - Loan Growth: Loans increased $1.3 billion in Q3; year-to-date loan book growth of roughly $3.6 billion versus $4 billion full-year guidance. - Deposits: Combined deposit channels up roughly $1.6 billion; ~$2.9 billion held off balance sheet. - Institutional Revenue: $430 million in Q3, down 14% year-over-year; up 8% year-to-date through three quarters. - Institutional Investment Banking Revenue: $300 million, down 6% year-over-year; advisory revenue of $173 million (up 10% sequentially); equity capital raising of $69 million (down 13%); fixed income underwriting of $58 million (flat year-over-year). - Institutional Transactional Revenue: Fixed income of $80 million (down from ~$123 million); equity of $41 million (down from $59 million); Q4 guidance of $145 million$150 million. - Institutional Pre-Tax Margin: 18.9% year-to-date, up 530 basis points year-over-year. - Capital Ratios: Tier 1 leverage ratio of 10.8%; Tier 1 risk-based capital ratio of 17%. - Excess Capital: Nearly $360 million based on a 10% Tier 1 leverage target. - Share Repurchases: 1.6 million shares repurchased in Q3; 6.8 million shares repurchased year-to-date; 6.2 million shares remaining under authorization. - Q4 Outlook: Revenue expected to match prior-year record of $1.56 billion, with higher EPS expected. - Warning! GuruFocus has detected 5 Warning Signs with SF. - Is SF fairly valued? Test your thesis with our free DCF calculator. Release Date: October 21, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. - Stifel Financial Corp (NYSE:SF) is on track for another record year with year-to-date revenue up 9% to $4.3 billion and EPS up 57% to $4.33. - The company delivered its highest ever third-quarter EPS of $1.46, up 12% year-over-year, driven by improved operating leverage and a lower compensation ratio. - Global Wealth Management generated record net revenue of $980 million, up 8% year-over-year, with record asset management revenue and net interest income. - Net interest income exceeded guidance, setting a third-quarter record, supported by strong loan growth of $1.3 billion and a stable net interest margin. - Stifel Financial Corp (NYSE:SF) maintains a strong capital position with a Tier 1 leverage ratio of 10.8% and returned capital to shareholders through 1.6 million shares repurchased. - Institutional segment revenue declined 14% year-over-year to $430 million, with investment banking revenue down 6% and transactional revenue down 17%. - Fixed income transactional revenue fell to $80 million from $123 million last year, due to trading marks and absence of prior-year gains. - Equity transactional revenue decreased to $41 million from $59 million, impacted by European restructuring and lower equity volumes. - Net flows in the wealth management segment were slightly negative in the quarter, despite a strong recruiting pipeline. - The company expects full-year revenue to be at the low end of its guidance range, partly due to the impact of the SIA sale and European restructuring. Q: With Stifel trading at a discount to peers like Raymond James and Morgan Stanley despite superior EPS and tangible book value growth, would you consider a larger-scale M&A deal or a more aggressive buyback to close the valuation gap? A: CEO Ronald Kruszewski stated that large-scale M&A is unlikely, as paying significant market multiples for acquisitions would not be well-received by shareholders. He emphasized a focus on organic growth and shareholder value, noting that "an attractive one out there is called our own stock." CFO James Marischen added that the firm has significant flexibility, with $360 million in excess capital after funding $1.3 billion in loan growth and repurchasing 1.6 million shares, and will remain active in buybacks. Q: Can you provide more detail on the drivers of loan growth, particularly in fund banking, and discuss the strategic benefits of the recent investment in Meow Technologies? A: CEO Ronald Kruszewski described the fund and venture banking business as being in its "early innings" with significant structural growth potential. The investment in Meow Technologies provides a white-label treasury management platform that will accelerate client acquisition and deposit generation without the need for physical branches. CFO James Marischen added that this technology should increase the current ~$1 billion quarterly deposit growth rate and is a scalable channel for future growth. Q: Given the strong Q3 results, should we view the lower compensation ratio and higher pre-tax margin as a new, sustainable baseline for Stifel? A: CEO Ronald Kruszewski indicated that the lower comp ratio is a result of improved efficiency and productivity, and that growing net interest income will continue to drive it lower over time. He noted that the comp ratio typically declines throughout the year, reaching its best level in the fourth quarter. CFO James Marischen added that the 2026 exit rate for the comp ratio is a good starting point for thinking about 2027, with continued bank balance sheet growth being a key driver. Q: What is the outlook for institutional transactional revenue, and how much of the recent softness is cyclical versus structural? A: CEO Ronald Kruszewski believes the firm can return to a $160 million run rate, viewing the recent decline as a "blink of an eye" on a $6 billion revenue base. He attributed the softness to a "financial condition induced pause" in September, not structural issues, and noted that non-recurring items like restructuring and aircraft gains distort quarterly comparisons. CFO James Marischen guided to Q4 institutional transactional revenue of $145 million to $150 million, absent another sharp rate move. Q: Can you discuss the recruiting environment for financial advisors and how AI is impacting your strategy? A: CEO Ronald Kruszewski stated that while competition for advisors is high, Stifel's recruiting pipeline remains robust. The firm has shifted its strategy to recruit fewer, but higher-producing teams. Regarding AI, he views it as a productivity tool to assist advisors with tasks like meeting preparation and analysis, not as a replacement. He emphasized that Stifel is combining AI with human advisors, as clients still value personal relationships, especially in uncertain times. Q: What drove the decline in sweep cash this quarter, and what is your outlook for deposit growth in a higher-rate environment? A: CFO James Marischen attributed about $500 million of the decline to the final offboarding of assets related to the SIA sale. He expects a typical seasonal uptick in deposits in Q4 and highlighted that the firm has nearly $3 billion of off-balance-sheet deposits, $18 billion in money market funds, and $7 billion in short-term treasuries available to fund future loan growth. He also noted that the net interest margin has remained relatively stable despite a remix of deposits. Q: Can you elaborate on the strength in investment banking pipelines and the sectors driving activity? A: CEO Ronald Kruszewski noted that while activity slowed in September due to geopolitical and rate uncertainty, the pipeline remains strong, and Q4 is off to a good start. He is optimistic about a pickup in healthcare capital markets and sees secular trends, such as the need for scale and technology, driving depository M&A activity. He described the recent slowdown as a "pause" rather than a cancellation of deals. Q: How are you thinking about capital allocation between loan growth, buybacks, and advisor recruiting? A: CEO Ronald Kruszewski explained that advisor recruiting is viewed through the lens of return on invested capital, with acquisition costs amortized over a decade. He emphasized that Stifel has been capital-disciplined for nearly 30 years, growing from $100 million to $6 billion in revenue with a 24% ROTCE. CFO James Marischen added that the firm has the flexibility to both grow the loan book and repurchase shares, as demonstrated by deploying capital to both areas in Q3 while maintaining a strong capital position. Q: With net new assets slightly negative in the quarter, can you provide more color on the flows and the health of the wealth management franchise? A: CFO James Marischen reported that total client assets reached $576 billion, up 6% year-over-year, and fee-based assets were $240 billion, up 9%. While net flows were slightly negative for the quarter, he highlighted that over the prior 12 months, the firm added 90 total advisors, including 28 experienced advisors with trailing production of $19 million. CEO Ronald Kruszewski added that the recruiting pipeline remains very strong despite elevated competition. Q: Is Stifel's scale a disadvantage compared to larger peers, and would you consider a merger to bridge the valuation gap? A: CEO Ronald Kruszewski pushed back on the idea, stating that merging with a larger institution with lower growth and returns would not make sense. He argued that Stifel's superior financial metricsincluding a 24% ROTCE and 406% EPS growth since 2016should command a premium, not a discount. He emphasized that combining for scale in a people and culture business often leads to "diseconomies of scale" rather than benefits. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Stifel Financial (SF) is in focus this week as the firm prepares to report earnings on Wednesday morning, with the market watching for revenue growth of 1.4% year on year after a 16.7% increase in the same quarter last year. Stifel Financial's recent share price has been under pressure, with the stock down 12.84% over the past month and 22.77% year to date to US$66.06. However, the 3 year total shareholder return of 82.08% and 5 year total shareholder return of 40.10% show a very different longer term picture and suggest sentiment has cooled ahead of this earnings update rather than reversed the broader story. Compare this setup at Stifel Financial with other financial stocks where expectations and recent share price pressure may be out of sync by scanning our hand picked 35 high quality undervalued stocks. The question now is whether this sharp pullback in Stifel Financial reflects a crack in the underlying business or a swing in sentiment that has moved faster than the fundamentals. On Simply Wall St's most followed narrative, Stifel Financial's fair value sits at $86 compared with the recent $66.06 share price. This puts the current pullback in a different light and frames what analysts say could drive the next leg of the story. The build out of the venture and fund banking ecosystem, including hundreds of millions of dollars of venture deposits in a single quarter and additional off balance sheet funds, can increase cross selling into wealth management, investment banking and fixed income, which may raise overall revenue and earnings from each client relationship. See why 1 investors see Stifel Financial as 23% undervalued. Result: Fair Value of $86 (UNDERVALUED) Still, two pressure points could puncture this Stifel Financial narrative: higher than expected legal settlements that eat into margins, and weaker financial strength scores that constrain future lending and platform investment. Find out about the key risks to this Stifel Financial narrative. The popular narrative pegs Stifel Financial's fair value at $86, yet the SWS DCF model points to a future cash flow value of $42.33 with the shares at $66.06. That gap frames the stock as overvalued on this lens and raises a simple question: Which story do you trust more, cash flows or narratives? If you want to see how that cash flow driven outcome is built line by line, take a closer look at the SWS DCF model output for Stifel Financial, step through the assumptions, and decide which inputs make the most sense for your own process. Look into how the SWS DCF model arrives at its fair value. Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Stifel Financial for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 35 high quality undervalued stocks. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity. Views on Stifel Financial in this article might feel split, so move quickly to test the numbers, pressure test the narratives, and decide where you stand. For a focused snapshot of what is currently drawing optimism, review the 5 key rewards. Do not stop at Stifel Financial. Broaden your watchlist with fresh ideas drawn from different angles so you are not depending on one storyline alone. - Target potential mispricings by scanning a curated list of stocks that combine quality fundamentals with attractive entry points through the 35 high quality undervalued stocks. - Strengthen your income toolkit by reviewing companies built around stable cash flows and high yields using the 8 dividend fortresses. - Prioritise resilience by filtering for companies with sturdy finances and cleaner balance sheets through the list of solid balance sheet and fundamentals (25 results). This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include SF. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

Financial services firm Stifel Financial (NYSE:SF) will be reporting earnings this Wednesday morning. Here's what investors should know. Stifel beat analysts' revenue expectations last quarter, reporting revenues of $1.45 billion, up 13.2% year on year. It was a strong quarter for the company, with a solid beat of analysts' yield estimates and a beat of analysts' EPS estimates. Is Stifel a buy or sell going into earnings? Read our full analysis here, it's free for active Edge members. This quarter, the market is expecting Stifel's revenue to grow 1.4% year on year, slowing from the 16.7% increase it recorded in the same quarter last year. Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business will stay the course heading into earnings. Stifel has missed Wall Street's revenue estimates multiple times over the last two years. Looking at Stifel's peers in the investment banking & brokerage segment, some have already reported their Q3 results, giving us a hint as to what we can expect. Goldman Sachs delivered year-on-year revenue growth of 23%, beating analysts' expectations by 11.5%, and Jefferies reported revenues up 8.5%, topping estimates by 1.1%. Goldman Sachs traded down 1.7% following the results while Jefferies was also down 1.3%. Read our full analysis of Goldman Sachs's results here and Jefferies's results here. In the last twelve months or so, the market has shifted its attention from one area of macro importance to the next (AI disintermediation and AI capex spending to geopolitical conflict, rates, and whether the economy is on solid footing or not). While some of the investment banking & brokerage stocks have shown solid performance in this choppy environment, the group has generally underperformed, with share prices down 3.9% on average over the last month. Stifel is down 12.8% during the same time and is heading into earnings with an average analyst price target of $84.50 (compared to the current share price of $66.06). ALSO WORTH WATCHING: Nvidia's Quiet Partner. Nvidia's chips cost a hundred grand. The connectors that make them work cost even more. One company makes them all. Every AI server needs specialized infrastructure the chip companies don't make. High-speed cables. Power connectors. Thermal sensors. This 90-year-old company built a monopoly on it. The AI boom just started. This stock is still flying under the radar. Claim The Stock Ticker Here for FREE.