A month has gone by since the last earnings report for Raymond James Financial, Inc. (RJF Quick QuoteRJF - Free Report) . Shares have lost about 2.9% in that time frame, underperforming the S&P 500.

But investors have to be wondering, will the recent negative trend continue leading up to its next earnings release, or is Raymond James Financial due for a breakout? Well, first let's take a quick look at its latest earnings report in order to get a better handle on the recent catalysts for Raymond James Financial, Inc. before we dive into how investors and analysts have reacted as of late.

Raymond James Q3 Earnings Lag on Legal Reserve, IB & Trading Stay Solid

Raymond James’ third-quarter fiscal 2025 (ended June 30) adjusted earnings of $2.18 per share lagged the Zacks Consensus Estimate of $2.37. The bottom line also declined 9% from the prior-year quarter.

A $58 million reserve increase related to the settlement of a legal matter over bond underwritings for a specific issuer, sold to institutional investors between 2013 and 2015 was the primary reason that hurt the results. Higher expenses and provisions were other negatives.

On the other hand, robust investment banking and trading businesses supported top-line growth. Also, the Asset Management segment's performance was impressive.

CEO Paul Shoukry said, “Our investment banking pipeline remains strong, and we are growing increasingly optimistic about macroeconomic conditions although the environment remains uncertain.” 

Net income available to common shareholders (GAAP basis) was $435 million or $2.12 per share, down from $491 million or $2.31 per share in the prior-year quarter.

Revenues Increase, Expenses Rise

Quarterly net revenues were $3.40 billion, up 9% year over year. The top line beat the Zacks Consensus Estimate of $3.36 billion.

Segment-wise, in the reported quarter, the Private Client Group recorded 36% growth in net revenues, Asset Management’s net revenues rose 10% and Capital Markets’ top line jumped 15%. Further, Bank registered a rise of 10% from the prior year's net revenues, while Others recorded a 68% decline in net revenues.

Non-interest expenses jumped 10% from the prior-year quarter to $2.85 billion. The increase was due to a rise in all cost components. Our estimate for non-interest expenses was $2.74 billion. Further, RJF recorded bank loan provision for credit losses of $15 million in the reported quarter against a provision benefit of $10 million in the year-ago quarter.

As of June 30, 2025, client assets under administration were $1.64 trillion, up 11% from the prior-year quarter. Financial assets under management of $263.2 billion grew 15%. Our estimates for client assets under administration and financial assets under management were $1.57 trillion and $248 billion, respectively.

Balance Sheet & Capital Ratios Strong

As of June 30, 2025, Raymond James had total assets of $84.82 billion, up 2% from the prior quarter. Total equity was stable at $12.18 billion.

Book value per share was $60.90, up from $54.08 as of June 30, 2024.

As of June 30, 2025, the total capital ratio was 24.3% compared with 23.6% as of June 30, 2024. The Tier 1 capital ratio was 23% compared with 22.2% as of June 2024-end.

Return on common equity (annualized basis) was 14.3% at the end of the reported quarter compared with 17.8% a year ago.

Update on Share Repurchases

In the reported quarter, the company repurchased shares worth $451 million at an average price of $137 per share.

Outlook

For fiscal 2025, management expects non-compensation expenses, excluding the bank loan loss provision for credit losses, unexpected legal and regulatory items, and non-GAAP adjustments, to be $2.1 billion, representing about 10% growth from the prior year’s adjusted non-compensation figure.

The company expects fiscal fourth-quarter asset management and related administrative fees to be up 9% sequentially, primarily driven by higher PCG assets and fee-based accounts at quarter end and one more business day during the quarter.

Based on current interest rates and quarter end balances, management expects aggregate NII and Raymond James Bank Deposit Program (RJBDP) third-party fees to decline 2% in the fourth quarter.

For fiscal 2025, management estimates the effective tax rate to be approximately 24%.

How Have Estimates Been Moving Since Then?

It turns out, estimates review have trended upward during the past month.

VGM Scores

Currently, Raymond James Financial has a subpar Growth Score of D, though it is lagging a bit on the Momentum Score front with an F. However, the stock was allocated a grade of B on the value side, putting it in the top 40% for value investors.

Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending upward for the stock, and the magnitude of these revisions indicates a downward shift. Interestingly, Raymond James Financial has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

Performance of an Industry Player

Raymond James Financial belongs to the Zacks Financial - Investment Bank industry. Another stock from the same industry, Morgan Stanley (MS Quick QuoteMS - Free Report) , has gained 1.1% over the past month. More than a month has passed since the company reported results for the quarter ended June 2025.

Morgan Stanley reported revenues of $16.79 billion in the last reported quarter, representing a year-over-year change of +11.8%. EPS of $2.13 for the same period compares with $1.82 a year ago.

Morgan Stanley is expected to post earnings of $2.02 per share for the current quarter, representing a year-over-year change of +7.5%. Over the last 30 days, the Zacks Consensus Estimate has changed +0.1%.

Morgan Stanley has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of C.