Analyst Note| Michael Wong |
Raymond James' large wealth management and related banking business are leading to outperformance compared with peers. The company reported net income to common shareholders of $437 million, or $1.98 per diluted share, on a record $2.8 billion of net revenue for its fourth fiscal quarter ended in September. Over 75% of the company's net revenue is from its wealth management and banking businesses that benefit from rising interest rates, so the disruption in the economy affecting capital markets has had only a moderate effect on total revenue. We don't anticipate making a material change to our $100 fair value estimate for no moat-rated Raymond James Financial and assess shares are fairly valued.