Stifel Financial Corp Q3 2024 Earnings Call Summary

The following is excerpted from the question-and-answer section of the transcript.

Question: Devin Ryan - JMP Securities - Analyst : Thank you. Morning, Ron. Morning. Jim. How are you?

Question: Devin Ryan - JMP Securities - Analyst : The first question just on lending. Obviously, a great loan growth in the quarter. Ron, it sounds like you still expect more from here or pretty good demand. And I also appreciate it will be opportunistic as conditions change. But can you just maybe help quantify the level of demand that you're seeing and where it's coming from incrementally? And then it sounds like you guys think you can still grow net interest income from here, even as rates come down. Just want to get the interplay with that as well. Thanks.

Question: Devin Ryan - JMP Securities - Analyst : Okay, terrific. And then just a follow-up on fixed income brokerage. Appreciate revenues there were up year over year, and I think the second quarter had roughly $20 million gain. But it still seemed a little bit softer than we were looking for. So just love to get any sense of whether there were losses there. And then just the outlook, particularly with depositories as we look into later this year and next year there as well. Thanks.

Question: Devin Ryan - JMP Securities - Analyst : Okay, great. I'll leave it there. Thanks, guys.

Question: Steven Chubak - Wolfe Research - Analyst : Hi. Good morning. Hey, Ron. How are you? Jim, I hope you're doing well also. So I wanted to start off, just a clarifying question. Ron. You mentioned the $8 earnings target. It's something you alluded to before in the more normalized environment. Was that something that you were speaking to in the context of a more normal operating backdrop? Or is that actually a 2025 expectation for where earnings could check out?

Question: Steven Chubak - Wolfe Research - Analyst : Understood. I appreciate that. No. No, I appreciate that, Ron. And I did also want to ask on the buyback, just for my follow-up. Historically, you've been a good tactical buyer of your stock. We did see the moderation in share repurchases in the quarter. Just trying to square that positive message on the outlook, the earnings growth potential for next year that you outlined with that moderation in buyback, and just how you're thinking about the relative attractiveness of repurchase versus other alternatives, whether it would be bank growth or M&A. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 23, 2024 / 1:30PM, SF.N - Q3 2024 Stifel Financial Corp Earnings Call

Question: Steven Chubak - Wolfe Research - Analyst : No, of course. I appreciate that, Ron. I'll hop back in the queue. Thanks so much for taking my questions.

Question: Ben Rubin - UBS - Analyst : Hi. Good morning. Thank you for taking my questions. This is Ben Rubin filling in for Brandon. I wanted to start on the cash trends obviously positively inflecting, with sweep deposits up by nearly $370 million, although smart rate was about $500 million as well. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 23, 2024 / 1:30PM, SF.N - Q3 2024 Stifel Financial Corp Earnings Call And you recently cut rates on the smart rates. I was just curious, what type of impact have you seen on client flows on the back of rate cuts, if any? And what does that mean as far as your expectations for cash growth towards the end of the year? Thank you.

Question: Ben Rubin - UBS - Analyst : Great. Thanks. And then I was hoping to ask about the recovery in sponsor M&A. You're obviously -- your advisor results are coming on the right direction. So I was hoping you can just circle back on whether or not you've seen any improvement in the sponsor market as conditions improve and as borrowing costs and rates come down. Thank you.

Question: Ben Rubin - UBS - Analyst : Great. Thank you for taking my questions.

Question: Bill Katz - TD Cowen - Analyst : Okay. Thank you very much --

Question: Bill Katz - TD Cowen - Analyst : Good morning, everybody. Thank you very much for taking the questions. Busy morning. So FA count was relatively flat despite adding some more seasoned folks to the platform with good [showing] production. Can you step back a little bit and talk about how you see the net growth and maybe the competitive backdrop, what it means for incremental profit contribution for FA? Thank you.

Question: Bill Katz - TD Cowen - Analyst : Okay. That's helpful. And then just a follow up, maybe a conceptual question. Obviously, we haven't been here in a while. At what level of rates do you think you need to get to or we need to get to for money to migrate out of smart? It sounds like both were up again into the fourth quarter, which is nice. But is there -- at what level do you think you might actually start to see a migration back towards balance sheet cash? Or is it different this time -- which is always a dangerous thing to say -- in that higher rates, higher awareness just would structurally changed the mix ex a real sharp drop in rates? Thank you.

Question: Bill Katz - TD Cowen - Analyst : Great. Can I sneak in a clarifying question? I know it's my third question, so I apologize for [tax rate] goodwill. Just in terms of the tax rate into the fourth quarter, is this a new development that we should now start baking in prospectively as we think about '25 and beyond? Or is this more idiosyncratic just to this particular coming quarter?

Question: Bill Katz - TD Cowen - Analyst : Okay. Thank you very much. Take all the questions.