Raymond James (RJF) Stock Forecast & Price Target

Raymond James Finl is set to benefit from the current capital markets upcycle, along with capital return options and strong NNA growth. However, revised EPS estimates and limited upside potential pose some concerns. The firm's primary valuation framework is based on a target P/E multiple applied to its '26E EPS, incorporating factors such as forward interest rate curve expectations and excess capital deployment, with discounts applied using the firm's cost of equity. Despite the potential for M&A opportunities and solid B/S position, potential risks such as compensation trends and bank liquidity should be monitored.

Raymond James Finl is facing several key issues that are causing a negative outlook for the company, including lowered prospects for private client P/T income and NII, a potential slowdown in client cash growth, and a high loan/deposit ratio. The company's recent earnings update lacked depth of discussion and did not address concerns about elevated spending. While the company may benefit from the current market upcycle and have potential for strategic M&A and NNA growth, our revised EPS estimates are at or below consensus and our valuation framework indicates limited upside. Additionally, the company may face risks in the ESG space, and we assign a Hold rating based on these factors.