Stifel Financial Corporation · NYSE:SF
Stifel Financial — Investor Presentation (May 2011)
39 slides from Stifel Financial's investor presentation, May 11, 2011
Slide 1: Stifel Financial Investor Presentation
Stifel Financial Investor Presentation May 2011
Slide 2: Forward-Looking Statements
Forward-Looking Table of Contents Statements This presentation may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 that involve significant risks, assumptions, and uncertainties, including statements relating to the market opportunity a
Slide 3: I. Stifel Financial Overview
I. Stifel Financial Overview
Slide 4: Stifel Financial Overview: Firm at a Glance
Stifel Financial Overview Key Points of Differentiation Firm at a Glance Proven ability to build Global Wealth Global Wealth Institutional Management Business Management (GWM) Group (IG) Grown from 644 Financial Advisors in 2005 to 1,947 as of March 31, 2011 Private Client Equity & Convertib
Slide 5: A Growth Story
Stifel Financial Overview A Growth Story… Net Revenues ($MM) Core Net Income ($MM) Total Equity ($MM) $1,500 $1,382 $140 $1,400 $1,254 $1,287 CAGR: 39% CAGR: 43% $125 CAGR: 42% $1,200 $1,091 $120 $1,200 $870 $100 $1,000 $873 $900 $763 $76 $80 $73 $800 $67 $593 $600 $452 $60 $600 $40 $425 $264 $40 $4
Slide 6: Balanced Business Model
Stifel Financial Overview Balanced Business Model Balanced business model facilitates growth during volatile markets Stable GWM business is augmented by profitable and growing Institutional Group Proven ability to grow all businesses Net Revenues Operating Contribution 3 Months 2010 3 Months 2
Slide 7: Years of Growth
Stifel Financial Overview 15 Years of Growth 1995 – 2010 Net Revenues ($MM) $1,600 2010 Represented 15 Years of Consecutive Record Net Revenues $1,382 $1,400 CAGR since 1995: 20% CAGR since 2005: 39% $1,200 $1,091 $1,000 $870 $800 $763 $600 $452 $400 $247 $264 $217 $178 $177 $188 $200 $123 $127 $141
Slide 8: Stifel's Strong Stock Performance
Stifel Financial Overview Stifel’s Strong Stock Performance Assumes $100 Invested on December 31, 2005 $300 Stifel Financial Corp.(growth of 147.6% & 19.9% CAGR*) S&P 500 Index(growth of 11.9% & 2.3% CAGR*) $250 AMEX Securities Broker/Dealer Index(growth of -38.1% & -9.1% CAGR*) $200 Dollars $150 $1
Slide 9: Cumulative Price Appreciation
Stifel Financial Overview Cumulative Price Appreciation As of May 6, 2011 Since 12/31/10 Since 12/31/05 Since 12/31/00 SWS Group 29.50% Stifel Financial Corp. 158.70% Stifel Financial Corp. 1,039.86% Sanders Morris Harris 10.07% Raymond James Financial 41.36% Jefferies Group 207.07% Raymond James Fi
Slide 10: Stifel's Successful Track Record in Integrating Transactions
Stifel Financial Overview Stifel’s Successful Track Record in Integrating Transactions Builds the premier middle-market investment bank with the scale and diversification to become a top-tier player Complementary fit with minimal overlap in research and investment banking Closed on July 1, 201
Slide 11: Opportunities Drive our Growth
Stifel Financial Overview Opportunities Drive our Growth Strategy Continue to build client facing agency-only businesses in financial services Expand private client footprint in the U.S. Expand institutional equity business both domestically and internationally Grow investment banking Focu
Slide 12: II. Global Wealth Management
II. Global Wealth Management
Slide 13: Global Wealth Management Overview
Global Wealth Management Provides Securities Brokerage Services and Stifel Bank Products Overview Grown from 600+ financial advisors in 2005 to over 1,900(1) financial advisors currently Retail investors are generally mid- to long-term buyers Goal of providing price stability and support to th
Slide 14: Opportunity Through Growth
Global Wealth Management Opportunity Through Growth GWM Broker Growth (1) GWM Branch Growth 2,500 300 285 285 272 2,000 1,885 1,935 1,947 250 196 200 1,500 1,315 1,163 148 150 1,000 111 735 100 92 644 500 50 0 0 2005 2006 2007 2008 2009 2010 03/31/11 2005 2006 2007 2008 2009 2010 03/31/11 GWM Accoun
Slide 15: Stifel Bank & Trust: Low Risk Asset Growth Strategy
Global Wealth Management – Stifel Bank & Trust Low Risk Asset Growth Strategy & Opportunity Assets of $1.8 billion as of March 31, 2011, consistent Maintain solid asset quality: with December 31, 2010. Non-performing loans to gross loans of 0.19% Non-performing assets to total assets of 0.12
Slide 16: III. Institutional Group
STIFEL FINANCIAL IIL. Institutional Group
Slide 17: Institutional Group Overview
Institutional Group Overview Net Revenues ($MM)(1) $800 Provides securities brokerage, trading, research, CAGR: 18% underwriting and corporate advisory services $668 $626 $587 Largest provider of Equity Research in the U.S. $600 $559 $174 $84 #1 ranked in 2010 WSJ Best on the Street Survey $45
Slide 18: Second Largest U.S. Equity Research Platform
Institutional Group – Research Second Largest U.S. Equity Research Platform U.S. Equity Research Coverage (1) Stifel Research Highlights Companies Under Coverage Second largest provider of U.S. Equity Research Rank Firm Overall Small Cap(2) Currently cover more than 50% of the S&P 500 1 JPMorgan
Slide 19: The Stifel Research Model
Institutional Group – Research The Stifel Research Model The Stifel Research Model Research Accolades >50% of analysts worked in the field they cover Only firm ranked in the Top 12 each year for the last 7 years in ~35% of analysts initially joined as associates the WSJ Best on the Street Surv
Slide 20: Strong Research Performance
Institutional Group – Research Strong Research Performance: Top 5 in 4 of 10 Industry Verticals Trailing 24 Months Year to Date 2011 160% 10% 133.8% 135.2% 8.6% 140% 8% 6.7% 120% 100% 6% 5.4% 78.7% 80% 66.2% 60% 4% 3.0% 40% 2% 20% 0% 0% Buy Hold Sell S&P 500 Buy Hold Sell S&P 500 Broker Recommendati
Slide 21: Equity Sales and Trading Platform
Institutional Group – Equity Sales and Trading Powerful Platform Spanning North America and Europe Institutional Equity Sales Equity Trading 130 person sales force, commission based 40 coverage traders located in Experts in small and mid cap growth and value Baltimore, New York, Boston, Dall
Slide 22: Strong Fixed Income Capital Markets Capabilities
Institutional Group – Fixed Income Strong Fixed Income Capital Markets Capabilities Overview Client Distribution Comprehensive platform Other 7% Approximately 50 traders averaging 14 years of Credit Union experience 5% Annual client trade volume approaching $200 Government Money 6% Manager bil
Slide 23: Accomplished U.S. Equity Underwriting Franchise
Institutional Group – Investment Banking Accomplished U.S. Equity Underwriting Franchise – All Equity Transactions All Managed Equity Deals Since 2005 Bookrun Equity Deals Since 2005 ($ in billions) # of $ ($ in billions) # of % $ Rank Firm Deals Volume Rank Firm Deals Bookrun Volume 1 Bank of Ameri
Slide 24: Strong Momentum and Track Record as Bookrunner
Institutional Group – Investment Banking Strong Momentum and Track Record as Bookrunner 8,000 70 7,000 No. Deals 60 6,000 Deal Value Deal Value ($M) 50 5,000 No. Deals 40 4,000 30 3,000 2,000 20 1,000 10 0 0 Filed/Mandated 2002 2003 2004 2005 2006 2007 2008 2009 2010 Pipeline % of Deals Bookrun 17%
Slide 25: Leadership in the Venture Capital Community
Institutional Group – Investment Banking Leadership in the Venture Capital Community Selected Venture Capital-Backed IPOs All Managed Venture Capital-Backed IPOs Since 2005 ($ in billions) # of $ Rank Firm Deals Volume 1 Stifel Nicolaus Weisel 87 $11.6 2 Morgan Stanley 72 $11.0 3 JPMorgan 69 $11.7 3
Slide 26: IV. First Quarter 2011 Financial Results
IV. First Quarter 2011 Financial Results
Slide 27: Chairman's Comments
Chairman’s Comments Ronald J. Kruszewski, Chairman, President and Chief Executive Officer of Stifel Financial Commented: “Following our record fourth quarter results, the first quarter of 2011 proved to be our second best quarter in terms of net revenues, net income and diluted EPS. We also achieved
Slide 28: Stifel Financial Corp. Results
Stifel Financial Corp. Results Three months ended March 31, 2011 Three Months Ended March 31, 2011 Three Months Ended Merger- 12/31/10 Related 3/31/10 % (Non- % (2) (2) ($ in thousands, except per share amounts) GAAP Charges (1) Non-GAAP (GAAP) Change GAAP) Change Net revenues $ 366,613 $ 6 $ 366,61
Slide 29: Sources of Revenues
Sources of Revenues Quarter Ended % % ($ in thousands) 3/31/11 3/31/10 Change 12/31/10 Change Revenues Commissions $ 155,786 $ 105,035 48.3% $ 139,605 11.6% Principal transactions 92,859 117,420 (20.9%) 89,996 3.2% Asset mgt and service fees 57,680 41,103 40.3% 57,042 1.1% Investment banking 41,418
Slide 30: Principal Transactions Revenues
Principal Transactions Revenues Quarter Ended % % ($ in thousands) 3/31/11 3/31/10 Change 12/31/10 Change Taxable debt $ 51,419 $ 64,691 (20.5%) $ 46,924 9.6% Municipal debt 19,538 16,842 16.0% 18,520 5.5% Equities 11,623 22,284 (47.8%) 11,396 2.0% Other 10,279 13,603 (24.4%) 13,156 (21.9%) $ 92,859
Slide 31: Investment Banking Revenues
Investment Banking Revenues Quarter Ended % % ($ in thousands) 3/31/11 3/31/10 Change 12/31/10 Change Capital raising $ 32,358 $ 25,307 27.9% $ 50,404 (35.8%) Advisory 9,060 8,914 1.6% 40,571 (77.7%) $ 41,418 $ 34,221 21.0% $ 90,975 (54.5%) Q1 2010 Revenues by Product Q1 2011 Revenues by Product Adv
Slide 32: TWPG Merger-Related Expenses
TWPG Merger-Related Expenses Nine Months Ended Quarter Ended 12/31/10 3/31/11 6/30/11 ($ in thousands) Estimate Actual Estimate Actual Estimate Operating expenses: Compensation and benefits $ 180,850 $ 186,034 (1) $ - $ (244) - (2) Non-comp operating expenses 24,700 19,011 5,000 2,705 3,000 (3) Tota
Slide 33: Global Wealth Management
Global Wealth Management Quarter Ended % % ($ in thousands) 3/31/11 3/31/10 Change 12/31/10 Change Commissions $ 101,762 $ 79,587 27.9% $ 92,558 9.9% Principal transactions 56,163 59,871 (6.2%) 58,520 (4.0%) Asset management & service fees 57,530 40,894 40.7% 56,953 1.0% Net interest 11,169 11,034 1
Slide 34: Stifel Bank & Trust
Stifel Bank & Trust An Operating Unit of GWM Quarter Ended ($ in thousands) 3/31/11 3/31/10 % Change 12/31/10 % Change Net revenues: Interest 11,203 8,087 38.5% 9,287 20.6% Other income 1,932 2,113 (8.6%) 3,553 (45.6%) Total revenues 13,135 10,200 28.8% 12,840 2.3% Interest expense 4,237 448 845.8%
Slide 35: Institutional Group Results
Institutional Group Results Quarter Ended % % ($ in thousands) 3/31/11 3/31/10 Change 12/31/10 Change Commissions $ 54,025 $ 25,448 112.3% $ 47,047 14.8% Principal transactions 36,696 57,549 (36.2%) 35,564 3.2% Investment banking 35,106 28,918 21.4% 81,583 (57.0%) (1) Other income 1,167 1,377 (15.3%
Slide 36: Statement of Financial Condition
Statement of Financial Condition As of March 31, 2011 Total Assets ($ in Billions) Total Capitalization ($ in Billions) $5.0 $1.5 $1.4 $4.5 $1.3 $4.2 $0.1 $0.1 $4.0 $1.2 $3.2 $1.0 $3.0 $0.9 $0.1 $0.7 $2.0 $0.6 $0.5 $0.1 $1.3 $1.3 $1.5 $1.6 $0.1 $0.9 $1.1 $0.3 $1.0 $0.8 $0.3 $0.2 $0.6 $0.1 $0.4 $0.1
Slide 37: Other Financial Data
Other Financial Data As of As of 3/31/11 3/31/10 % Change 12/31/10 % Change Total assets (000s): Stifel Nicolaus & Stifel Financial $ 2,749,674 $ 2,112,054 30.2% $ 2,444,310 12.5% Stifel Bank 1,787,531 1,115,329 60.3% 1,773,720 0.8% Total assets $ 4,537,205 $ 3,227,383 40.6% $ 4,218,030 7.6% Total s
Slide 38: V. Conclusion
STIFEL FINANCIAL
Slide 39: Looking Forward: Growth Opportunities
Looking Forward Growth Opportunities Stifel is well-positioned to take advantage of opportunities Changing environment and competitive landscape creating opportunity for market share gains Strategic opportunities to add talented professionals Expand private client network Expand fixed income