Wednesday, January 17, 2018
Business

Raymond James Financial operating on all cylinders with strong quarter, record stock price

Fast-growing St. Petersburg investment firm Raymond James Financial reported strong quarterly gains in revenues and earnings in its fiscal 2017 first quarter.

Raymond James CEO Paul Reilly stated that growing client assets, including those under the recently revived Alex. Brown brand in the Middle Atlantic states, and the Federal Reserve's decision to increase short-term interest rates should boost the wealth unit's earnings in future quarters.

"We continue to enjoy solid financial adviser recruiting and retention results," Reilly said, referring to the firm's aggressive efforts to hire wealth advisers from larger Wall Street firms under the Raymond James umbrella. Reilly, who has led the corporate expansion, received total compensation in the past fiscal year of $8.4 million, up from $7.8 million in the prior year and $5.6 million two years ago.

Raymond James Financial reported record quarterly net revenues of $1.49 billion and quarterly net income of $146.6 million, or $1 per diluted share. Quarterly net income increased 38 percent compared to the prior year's fiscal first quarter but declined 15 percent from the preceding quarter.

An additional $30 million was added to the firm's legal reserves, an increase Reilly described as above normal. The reserve appears tied to recent acquisitions, but no further details were offered.

Reilly spoke with analysts Thursday morning on a quarterly conference call. He warmed up with a joke about the possible huge crowd listening in on the call, citing the difference between "facts" and "alternative facts" — a reference to the new Trump administration's use of the phrase to explain its exaggerated crowd estimates during the presidential inauguration. Reilly said he hoped he would be dealing with "real facts" during the call about his investment firm's strong performance.

Raymond James shares have soared since November and closed Thursday at $77.16, another record high, in the same week the Dow Jones Industrial Average crossed the 20,000 threshold. The company boasts a market cap exceeding $10.5 billion, making it by far the most valuable publicly traded company based in the Tampa Bay market.

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