RJF

Raymond James is the kind of steady compounder the market rarely puts on sale, and at $154.79 it's roughly 15x FY2025 diluted EPS of $10.30 and 1.9x sales — undemanding for a business earning a 17.1% return on equity. The five-year record is consistent and profitable: revenue climbed from $9.91B (FY2021) to $15.9B (FY2025) and net income from $1.40B to $2.13B, every year up. Management is also returning capital intelligently — shares outstanding fell 3.6% YoY, which is why EPS grew 6.2% even as net income grew only 3.2%. Operating cash flow of $2.43B (+12.9%) comfortably exceeds the $188M capex bill, so the buyback and dividend are funded out of genuine cash generation, not leverage.

The balance sheet is sound for a broker-dealer. The headline 6.06x liabilities/equity looks heavy, but that's the normal shape of a firm that runs a bank and holds client-related assets; equity grew 7.1% to $12.5B, retained earnings jumped 14.4% to $13.6B, and the company sits on $11.4B of cash. The auditor issued an unqualified opinion on both the financials and internal controls. The one item the auditor flagged as a Critical Audit Matter is the $452M allowance for credit losses on the bank's commercial & industrial and commercial real estate loan books — a reminder that RJF is no longer a pure brokerage but carries genuine credit exposure, and CRE in particular is where loss assumptions are hardest to model.