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Moelis & Company (MC) Incurs Loss in Q4, Revenues Rise Y/Y
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Moelis & Company (MC - Free Report) incurred a fourth-quarter 2023 adjusted loss per share of 6 cents, which was narrower than the Zacks Consensus Estimate for a loss of 11 cents. The bottom line compared unfavorably with earnings of 33 cents in the prior-year quarter.
Results were adversely impacted by a surge in expenses. However, an improvement in revenues and a solid liquidity position were the positives.
Net loss (GAAP basis) was $6.5 million or 8 cents per share against a net income of $22.7 million or 28 cents per share in the prior-year quarter.
For 2023, adjusted loss of 20 cents per share was narrower than the consensus estimate of a loss of 24 cents. Last year, adjusted earnings were $2.22. Net loss (GAAP basis) was $27.5 million or 36 cents per share against a net income of $168.7 million or $2.14 per share in 2022.
Revenues Rise, Expenses Jump
Total revenues (GAAP basis) for the reported quarter grew 4% year over year to $214.9 million. This was driven by a rise in fees earned from restructuring and capital markets transactions. The top line also beat the Zacks Consensus Estimate of $194.7 million.
For 2023, total revenues (GAAP) were $854.7 million, down 13%. The top line, however, outpaced the Zacks Consensus Estimate of $838.2 million.
Total operating expenses (GAAP basis) were $224.2 million, jumping 26%. The rise was due to an increase in both compensation and benefits costs and non-compensation expenses. Our estimates for total operating expenses were $213.4 million.
Other income (GAAP basis) was $5.1 million in the reported quarter, surging 79% from the prior-year quarter.
As of Dec 31, 2023, the company had cash and liquid investments of $349.3 million, with no debt or goodwill.
Our View
Moelis & Company’s global expansion initiatives and diverse operations across sectors and industries bode well. However, heightened geopolitical and macroeconomic uncertainties will continue to adversely impact the company’s financials.
Moelis & Company Price, Consensus and EPS Surprise
Raymond James’ (RJF - Free Report) first-quarter fiscal 2024 (ended Dec 31, 2023) adjusted earnings of $2.40 per share surpassed the Zacks Consensus Estimate of $2.25. The bottom line was up 5% from the prior-year quarter.
Robust investment banking and brokerage performances aided the Capital Markets segment’s results. The performances of the Private Client Group and the Asset Management segments were also decent. The acquisitions over the past years supported the company’s financials to some extent.
However, RJF recorded bank loan provision for credit losses during the quarter on the tough macroeconomic outlook. Also, expenses increased in the quarter, which hurt the results to some extent.
Evercore Inc.’s (EVR - Free Report) fourth-quarter 2023 adjusted earnings per share of $2.02 surpassed the Zacks Consensus Estimate of $1.63. However, the bottom line was down from the prior-year quarter’s $3.50.
A decline in net revenues of the Investment Banking & Equities segment hampered the overall top line. Nonetheless, an improvement in assets under management balance was a positive for EVR. A rise in Investment Management segment revenues also offered some support.
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Moelis & Company (MC) Incurs Loss in Q4, Revenues Rise Y/Y
Moelis & Company (MC - Free Report) incurred a fourth-quarter 2023 adjusted loss per share of 6 cents, which was narrower than the Zacks Consensus Estimate for a loss of 11 cents. The bottom line compared unfavorably with earnings of 33 cents in the prior-year quarter.
Results were adversely impacted by a surge in expenses. However, an improvement in revenues and a solid liquidity position were the positives.
Net loss (GAAP basis) was $6.5 million or 8 cents per share against a net income of $22.7 million or 28 cents per share in the prior-year quarter.
For 2023, adjusted loss of 20 cents per share was narrower than the consensus estimate of a loss of 24 cents. Last year, adjusted earnings were $2.22. Net loss (GAAP basis) was $27.5 million or 36 cents per share against a net income of $168.7 million or $2.14 per share in 2022.
Revenues Rise, Expenses Jump
Total revenues (GAAP basis) for the reported quarter grew 4% year over year to $214.9 million. This was driven by a rise in fees earned from restructuring and capital markets transactions. The top line also beat the Zacks Consensus Estimate of $194.7 million.
For 2023, total revenues (GAAP) were $854.7 million, down 13%. The top line, however, outpaced the Zacks Consensus Estimate of $838.2 million.
Total operating expenses (GAAP basis) were $224.2 million, jumping 26%. The rise was due to an increase in both compensation and benefits costs and non-compensation expenses. Our estimates for total operating expenses were $213.4 million.
Other income (GAAP basis) was $5.1 million in the reported quarter, surging 79% from the prior-year quarter.
As of Dec 31, 2023, the company had cash and liquid investments of $349.3 million, with no debt or goodwill.
Our View
Moelis & Company’s global expansion initiatives and diverse operations across sectors and industries bode well. However, heightened geopolitical and macroeconomic uncertainties will continue to adversely impact the company’s financials.
Moelis & Company Price, Consensus and EPS Surprise
Moelis & Company price-consensus-eps-surprise-chart | Moelis & Company Quote
Currently, Moelis & Company has a Zacks Rank #5 (Strong Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Investment Banks
Raymond James’ (RJF - Free Report) first-quarter fiscal 2024 (ended Dec 31, 2023) adjusted earnings of $2.40 per share surpassed the Zacks Consensus Estimate of $2.25. The bottom line was up 5% from the prior-year quarter.
Robust investment banking and brokerage performances aided the Capital Markets segment’s results. The performances of the Private Client Group and the Asset Management segments were also decent. The acquisitions over the past years supported the company’s financials to some extent.
However, RJF recorded bank loan provision for credit losses during the quarter on the tough macroeconomic outlook. Also, expenses increased in the quarter, which hurt the results to some extent.
Evercore Inc.’s (EVR - Free Report) fourth-quarter 2023 adjusted earnings per share of $2.02 surpassed the Zacks Consensus Estimate of $1.63. However, the bottom line was down from the prior-year quarter’s $3.50.
A decline in net revenues of the Investment Banking & Equities segment hampered the overall top line. Nonetheless, an improvement in assets under management balance was a positive for EVR. A rise in Investment Management segment revenues also offered some support.