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STIFEL FINANCIAL CORP (SF)·Q3 2025 Earnings Summary

Executive Summary

  • Record net revenues of $1.43B, up 16.7% YoY and 11.3% QoQ; non-GAAP diluted EPS of $1.95, up 30% YoY; GAAP diluted EPS available to common of $1.84 .
  • Both segments executed strongly: Global Wealth Management net revenues reached a record $907.4M (+9.7% YoY), and Institutional Group revenues were $500.4M (+34.4% YoY) with broad-based strength in advisory, underwriting, and trading .
  • Stifel beat Wall Street consensus: revenue by ~7.0% and EPS by ~5.7% in Q3 2025; investment banking pipelines and client assets are at record levels, positioning for a strong Q4 (EPS and revenue estimates from S&P Global*) *.
  • Q4 guidance: net interest income of $270–$280M, full-year tax rate 20–22% (Q4 implied 12–14%), and diluted shares ~110.3M; capital return continued with $31.2M buybacks and a $0.46 dividend maintained .
  • CEO tone confident: “Record net revenue…$1.95 in EPS…record client assets… Stifel is well positioned to build on its success” and “you get a growth company at value company prices” .

What Went Well and What Went Wrong

What Went Well

  • Broad-based beat vs Street: “we exceeded Street expectations across the board… net revenue ~7% above consensus; EPS ~5% ahead” (Operating EPS) *.
  • Global Wealth Management posted record net revenue ($907.4M), record client assets ($544.0B), and record asset management revenues ($431.4M); pretax margin ~37.8% .
  • Institutional momentum: advisory $179.3M (+31% YoY), equity underwriting $78.8M (+55% YoY), fixed income underwriting $58.9M (+19% YoY), and strong trading (FI $122.6M, equity $58.3M); non-comp ratio fell to 22.8% and pretax margin rose to 17.8% .
  • Quote: “Record net revenue…third highest EPS…record client assets… integrated wealth and banking platform continues to gain momentum” – CEO Ron Kruszewski .
  • Quote: “Institutional revenue was $500M up 34%… equity underwriting best since late 2021… public finance #1 by negotiated issues” – CFO .

What Went Wrong

  • Provision for credit losses rose YoY to $8.3M (vs. $5.3M), driven by overall loan growth and specific reserves .
  • Other income declined YoY (-23.9%) and interest revenue fell (-5.7%) YoY amid lower asset yields, partly offset by lower funding costs .
  • Post-quarter sweep cash saw near-term volatility: “through yesterday, down from quarter end by ~$500M+” even as venture deposits grew by ~$1B; day-to-day swings are “several hundred million” .

Financial Results

MetricQ3 2024Q2 2025Q3 2025
Net Revenues ($USD Billions)$1.225 $1.284 $1.429
Diluted EPS (GAAP, available to common)$1.34 $1.34 $1.84
Diluted EPS (Non-GAAP)$1.50 $1.71 $1.95
Pre-tax Margin (GAAP)17.7% 16.6% 20.0%
Compensation Ratio (GAAP)58.6% 60.3% 58.8%
Non-Compensation Ratio (GAAP)23.7% 23.1% 21.2%

Segment net revenues:

Segment ($USD Millions)Q3 2024Q2 2025Q3 2025
Global Wealth Management$827.1 $845.6 $907.4
Institutional Group$372.4 $419.8 $500.4
Other$25.2 $18.9 $21.5

Institutional investment banking components:

IB Component ($USD Millions)Q3 2024Q2 2025Q3 2025
Advisory$136.9 $127.3 $179.3
Equity Capital Raising$50.7 $46.2 $78.8
Fixed Income Capital Raising$49.4 $53.7 $58.9

KPIs and capital:

KPIQ3 2024Q2 2025Q3 2025
Total Client Assets ($USD Billions)$496.3 $516.5 $544.0
Fee-Based Client Assets ($USD Billions)$190.8 $206.3 $219.2
Bank Loans ($USD Billions)$20.63 $21.45 $21.64
ROTCE (Non-GAAP, %)19.5% 21.7% 24.3%
Tangible Book Value/Share ($)$33.62 $33.30 $34.99
Tier 1 Leverage Capital Ratio (%)11.3% 10.8% 11.1%

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Net Interest Income ($USD Millions)Q4 2025Not provided$270–$280 New range provided
Effective Tax Rate (%)Full-year 2025Not provided20–22; Q4 implied 12–14 New range provided
Diluted Share Count (Millions)Q4 2025Not provided~110.3 New disclosure
Loan Growth Target ($USD Billions)H2 2025Not provided~$1.0 loan growth goal New target
Quarterly Dividend ($/share)Q3/Q4 2025$0.46 (Q2 declared) $0.46 maintained Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q1 2025 and Q2 2025)Current Period (Q3 2025)Trend
Advisor RecruitingQ1: +52 FAs; legal accrual weighed on margins . Q2: +82 FAs; strongest quarter in 10 years; record client assets .Q3: +33 FAs; pipeline “healthy” into year-end .Strong/ongoing
Investment Banking PipelinesQ1 advisory +15% YoY; mix balanced . Q2 momentum building .Record pipelines; broad advisory and underwriting strength; equity best since late 2021 .Improving
FICC Trading SynergiesQ2 FI transactional +21% YoY; realized gains .Strong FI and equity trading; balance sheet restructuring drives revenue; run-rate guide ~$100M for Q4 transactional .Positive/normalized
Sweep Deposits & Venture BankingQ2 deposits rising, venture team adding funding .Q3 sweep +$640M; non-wealth +$760M; venture deposits +$1B; October swings down ~$500M post quarter .Growing but volatile
Macro/PolicyQ1: markets resilient despite volatility .CEO cites rate cut in Sept, valuation considerations, “Liberation Day tariffs” rebound; constructive backdrop .Constructive
Credit & CLO ExposureQ1 provisions elevated; legal accrual impact .Provisions modest; CLO book AAA/AA with ~30% credit enhancement; comfort through cycles .Stable/risk-managed

Management Commentary

  • CEO: “We delivered record net revenue of more than $1.4 billion and $1.95 in earnings per share… driven by record results in Global Wealth Management and a 34% increase in Institutional revenue… Stifel is well positioned to build on its success” .
  • CFO: “Net interest income was $276M… forecast fourth quarter NII to be in a range of $270–$280M… effective tax rate for the fourth quarter 12–14% (full-year 20–22%)” .
  • CEO on valuation: “At current prices, you get a growth company at value company prices” .
  • CFO on pipelines and underwriting: “Equity capital raising revenue… best since late 2021… public finance #1 by negotiated issues led… advisory pipelines ended the quarter at record levels” .

Q&A Highlights

  • Institutional margin potential: Management sees IG pretax margins achievable in low-20s over time (from ~13.6% YTD), with leverage from both comp and non-comp expenses; implies a few hundred million of margin expansion at ~$2B run-rate .
  • Capital allocation: Balanced between buybacks and strategic bank growth; acquisitions more muted given valuations, but remain in DNA; buybacks viewed as compelling at current prices .
  • Recruiting drivers: Platform, service, competitive economics; leadership hires; note ACAT system slows in December seasonally .
  • Credit/CLO: Loan book concentrated in lower-risk categories; CLO exposure entirely AAA/AA with ~30% credit enhancement; no AAA defaults historically, one AA pre-GFC .
  • Near-term cash trends: Sweep balances down ~$500M post quarter amid daily volatility, but deposit growth continues and is expected to rise into year end .

Estimates Context

  • Q3 2025 Wall Street consensus vs actual: EPS $1.85* vs $1.95 (beat), revenue $1.33B* vs $1.43B (beat); # of estimates: EPS (7), revenue (5)*.
  • Prior periods: Q2 2025 EPS $1.61* vs $1.71; revenue $1.23B* vs $1.28B (beats). Q3 2024 EPS $1.60 vs $1.50 and revenue $1.20B* vs $1.225B (mixed)*.
  • Implication: Upward estimate revisions likely for IB and transactional revenues; model non-comp adjusted ratio near ~19% per CFO, and NII within $270–$280M for Q4 .
    Values retrieved from S&P Global.*
MetricQ3 2024Q2 2025Q3 2025
Primary EPS Consensus Mean* ($)1.601.611.85
Revenue Consensus Mean* ($USD Billions)1.201.231.33
Actual Diluted EPS (Non-GAAP, $)1.50 1.71 1.95
Actual Net Revenues ($USD Billions)1.225 1.284 1.429
EPS # of Estimates*767
Revenue # of Estimates*655

Key Takeaways for Investors

  • Broad-based beat with operating leverage: non-GAAP pretax margin 21.2% and ROTCE 24.3% underscore efficiency improvements in both segments .
  • Institutional acceleration is real: advisory, ECM, and FICC transactional strength plus record pipelines point to durable momentum into Q4 .
  • Wealth flywheel intact: record client and fee-based assets support recurring revenue; recruiting remains robust, sustaining growth .
  • Near-term modeling: set Q4 NII to $270–$280M, tax rate 12–14%, diluted shares ~110.3M; adjust non-comp ratio near 19% per CFO commentary .
  • Credit/resilience: provisions modest, capital ratios strong (Tier 1 leverage 11.1%, risk-based 17.6%); CLO risk positioned in AAA/AA tranches .
  • Capital return continues: buybacks ($31.2M) and dividend ($0.46) maintained, with excess capital of ~$421M above a 10% Tier 1 leverage target .
  • Trading stance: Positive bias into Q4 on IB/activity catalysts and estimate revision potential; watch October sweep volatility and macro shifts (rates, policy) .
Notes on GAAP vs non-GAAP EPS:
- GAAP “diluted EPS” (firm-wide) was $1.92, while GAAP diluted EPS available to common shareholders was $1.84; non-GAAP diluted EPS available to common was $1.95 **[720672_0001193125-25-245829_d25533dex992.htm:0]** **[720672_0001193125-25-245829_d25533dex991.htm:7]** **[720672_0001193125-25-245829_d25533dex991.htm:6]**.

Citations: .

*Values retrieved from S&P Global.