Sept 28 (Reuters) – Jefferies Financial beat third-quarter profit estimates on Monday, as higher fees from advising on deals and underwriting stock sales were complemented by a record haul in equities trading business.
Its asset management business, however, took a hit, with fees and investment return revenue shrinking to $34 million from $84 million a year earlier. That reflects weaker performance across several fund strategies, including Point Bonita, which had exposure to bankrupt auto-parts supplier First Brands.
• Global dealmaking has crossed $4 trillion this year as corporate boardrooms look past market volatility, taking advantage of an easier regulatory backdrop to scale their businesses.
• Jefferies’ investment banking revenue jumped 17% to $1.33 billion, underpinned by record advisory business performance and strong equity underwriting.
• The New York-based investment bank’s results are closely watched on Wall Street for an early glimpse into quarterly investment banking trends, before large US banks report earnings in the coming weeks.
• Revenue from capital markets business, which houses Jefferies’ trading desks, jumped 11% to $802 million, driven by record equities trading performance.
• “We are very optimistic about the balance of 2026 and our momentum heading into 2027, supported by the breadth and strength of our current backlog and new business activity,” CEO Richard Handler and President Brian Friedman said.
• Handler and Friedman said they remain confident in the long-term outlook for the asset management business as Jefferies continues to reposition the platform.
• Profit attributable to Jefferies shareholders was $260.6 million, or $1.08 per share, in the three months ended August 31. Analysts, on average, estimated a profit of $1 per share, according to data compiled by LSEG.
• Its shares were down 1.5% in extended trading, and have fallen roughly 24% this year.
(Reporting by Arasu Kannagi Basil in Bengaluru and Saeed Azhar in New York; Editing by Shilpi Majumdar)
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