We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Evercore (EVR) Up 8% Since Last Earnings Report: Can It Continue?
Read MoreHide Full Article
A month has gone by since the last earnings report for Evercore (EVR - Free Report) . Shares have added about 8% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Evercore due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Evercore Q2 Earnings Beat Estimates, Revenues Down
Evercore reported second-quarter 2020 adjusted earnings per share of $1.53, beating the Zacks Consensus Estimate of $1.27. However, results were down 26.1% from the prior-year quarter’s $2.07 per share.
The quarterly results reflected a solid liquidity position and an increase in AUM. However, decline in revenues and escalating expenses were major concerns.
Including certain one-time items, on a GAAP basis, net income available to common shareholders was $56.4 million or $1.35 per share compared with the $81.7 million or $1.88 per share witnessed in the year-ago quarter.
Revenues Fall, Expenses Rise
Net revenues decreased 4% year over year to $513.9 million in the reported quarter. This downside resulted from a fall in advisory fees (down 24%), partially offset by strong commissions and trades (up 11%). However, the revenue figure surpassed the Zacks Consensus Estimate of $456.6 million. On a GAAP basis, net revenues came in at $507.1 million, down 5%.
Total expenses went up 4% to $408.6 million from the prior-year quarter. This upswing mainly stemmed from rise in employee compensation and benefits expenses.
Adjusted compensation ratio was 65%, up from the year-earlier quarter’s 58%.
Adjusted operating margin came in at 20% compared with the prior-year quarter’s 25.8%.
Quarterly Segment Performance (Adjusted)
Investment Banking: Net revenues dropped 4% year over year to $500 million. Moreover, operating income slid 25% to $100.5 million. Advisory client transactions were 222,000, down 1% year over year.
Investment Management: Net revenues were $13.9 million, down 17% from the prior year’s comparable quarter. Operating income came in at $2.2 million, plummeting 55% year over year. Additionally, an AUM of $10.4 million was reported in the second quarter, up 3% year over year.
Balance-Sheet Position
As of Jun 30, 2020, cash, cash equivalents and marketable securities totaled $1.1 billion. Moreover, current assets exceeded current liabilities by $951.1 million as of the same date.
Capital Deployment
During the June-end quarter, the company repurchased 4,000 shares at an average cost of $58.28 per share.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended upward during the past month. The consensus estimate has shifted 93.1% due to these changes.
VGM Scores
Currently, Evercore has a great Growth Score of A, a grade with the same score on the momentum front. Following the exact same course, the stock was allocated a grade of A on the value side, putting it in the top 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Evercore has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Evercore (EVR) Up 8% Since Last Earnings Report: Can It Continue?
A month has gone by since the last earnings report for Evercore (EVR - Free Report) . Shares have added about 8% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Evercore due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Evercore Q2 Earnings Beat Estimates, Revenues Down
Evercore reported second-quarter 2020 adjusted earnings per share of $1.53, beating the Zacks Consensus Estimate of $1.27. However, results were down 26.1% from the prior-year quarter’s $2.07 per share.
The quarterly results reflected a solid liquidity position and an increase in AUM. However, decline in revenues and escalating expenses were major concerns.
Including certain one-time items, on a GAAP basis, net income available to common shareholders was $56.4 million or $1.35 per share compared with the $81.7 million or $1.88 per share witnessed in the year-ago quarter.
Revenues Fall, Expenses Rise
Net revenues decreased 4% year over year to $513.9 million in the reported quarter. This downside resulted from a fall in advisory fees (down 24%), partially offset by strong commissions and trades (up 11%). However, the revenue figure surpassed the Zacks Consensus Estimate of $456.6 million. On a GAAP basis, net revenues came in at $507.1 million, down 5%.
Total expenses went up 4% to $408.6 million from the prior-year quarter. This upswing mainly stemmed from rise in employee compensation and benefits expenses.
Adjusted compensation ratio was 65%, up from the year-earlier quarter’s 58%.
Adjusted operating margin came in at 20% compared with the prior-year quarter’s 25.8%.
Quarterly Segment Performance (Adjusted)
Investment Banking: Net revenues dropped 4% year over year to $500 million. Moreover, operating income slid 25% to $100.5 million. Advisory client transactions were 222,000, down 1% year over year.
Investment Management: Net revenues were $13.9 million, down 17% from the prior year’s comparable quarter. Operating income came in at $2.2 million, plummeting 55% year over year. Additionally, an AUM of $10.4 million was reported in the second quarter, up 3% year over year.
Balance-Sheet Position
As of Jun 30, 2020, cash, cash equivalents and marketable securities totaled $1.1 billion. Moreover, current assets exceeded current liabilities by $951.1 million as of the same date.
Capital Deployment
During the June-end quarter, the company repurchased 4,000 shares at an average cost of $58.28 per share.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended upward during the past month. The consensus estimate has shifted 93.1% due to these changes.
VGM Scores
Currently, Evercore has a great Growth Score of A, a grade with the same score on the momentum front. Following the exact same course, the stock was allocated a grade of A on the value side, putting it in the top 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Evercore has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.