Stifel Financial Corporation · NYSE:SF
Stifel Financial — JMP Conference (September 2011)
30 slides from Stifel Financial's conference presentation, September 2011
Slide 1: Stifel Financial Investor Presentation
Stifel Financial Investor Presentation September 2011
Slide 2: Disclaimer
Disclaimer Table of Contents Forward-Looking 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 op
Slide 3: I. Stifel Financial Overview
I. Stifel Financial Overview
Slide 4: Stifel Financial Overview
Stifel Financial Overview Stifel Financial (NYSE: SF) Financial services firm demonstrating growth, scale and stability $1.5 billion market capitalization(1) 2010 Represented 15 years of consecutive record net revenues Balanced business model Top performing financial stock since 12/31/2000
Slide 5: A Growth Story
Stifel Financial Overview A Growth Story… Net Revenues ($MM)(2) Core Net Income ($MM)(2) Total Equity ($MM)(2) $1,500 $1,382 $140 CAGR: 39% CAGR: 43% $125 CAGR: 43% $1,400 $1,254 $1,296 $1,200 $120 $1,091 $1,200 $100 $870 $1,000 $873 $900 $763 $73 $76 $80 $67 $800 $60 $593 $600 $600 $452 $40 $425 $4
Slide 6: Building Scale
Stifel Financial Overview Building Scale… Strategic Growth Through Acquisitions Investment Banking Sales and Trading 2005¹ 6/30/2011 Private Client Group (IG) Retail October 2011 Financial Advisors 467 1,958 Brokerage Private Client Branches 94 288 Network Investment Banking Sales an
Slide 7: Stability Achieved Through A Balanced Business Model
Stifel Financial Overview Stability Achieved Through A 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 Contribu
Slide 8: Cumulative Price Appreciation
Stifel Financial Overview Cumulative Price Appreciation As of September 16, 2011 Since 12/31/10 Since 12/31/05 Since 12/31/00 SWS Group 17.03% Stifel Financial Corp. 73.04% Stifel Financial Corp. 662.46% S&P 500 Index -3.31% Raymond James Financial 11.02% Jefferies Group 89.31% Edelman Financial Gro
Slide 9: Market Observations and Strategy
Market Observations and Strategy Global Wealth Management Outlook Private client flow business The firm is well positioned, even in the current environment Stifel Bank Low leverage business model Asset mix AUM Recruiting trends Strategy Institutional Group Continue growth strategy
Slide 10: Stifel Financial To Acquire Stone & Youngberg
Stifel Financial To Acquire Stone & Youngberg Strategic Acquisition With a Premiere Public Finance Investment Bank Expected to Close Oct. 1 Transaction Stifel to acquire 100% of the membership interests of Stone & Youngberg LLC Expands Stifel’s public finance, institutional sales and trading, bo
Slide 11: II. Global Wealth Management
II. Global Wealth Management
Slide 12: Global Wealth Management
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 Proven organic growth and acquirer of private client business (56 UBS branches, Butler Wick, Ryan Beck) Ret
Slide 13: Opportunity Through Growth
Global Wealth Management Opportunity Through Growth GWM Broker Growth (1) GWM Branch Growth 2,500 300 285 288 272 1,885 1,935 1,958 2,000 250 196 1,500 200 1,315 1,163 148 150 1,000 111 735 100 92 644 500 50 0 0 2005 2006 2007 2008 2009 2010 06/30/11 2005 2006 2007 2008 2009 2010 06/30/11 GWM Accoun
Slide 14: Global Wealth Management – Stifel Bank & Trust
Global Wealth Management – Stifel Bank & Trust Overview Strength of Brokerage Position Acquired FirstService Bank, a St. Louis-based, Offers banking products (securities based Missouri-chartered commercial bank, in April loans and mortgage loans) within the GWM client base 2007 Built-in source
Slide 15: III. Institutional Group
STIFEL FINANCIAL IIL. Institutional Group
Slide 16: Institutional Group
Institutional Group Overview Net Revenues ($MM)(1) $800 Provides securities brokerage, trading, research, CAGR: 18% $668 underwriting and corporate advisory services $587 $626 $600 $559 $174 $84 Largest provider of U.S. Equity Research $455 $197 2nd largest Equity trading platform in the U.S.
Slide 17: Institutional Group – Research
Institutional Group – Research Largest U.S. Equity Research Platform U.S. Equity Research Coverage (1) Stifel Research Highlights Companies Under Coverage Currently cover more than 50% of the S&P 500 Rank Firm Overall Small Cap(2) Second largest provider of U.S. Small-Cap 1 Stifel Nicolaus 1,029
Slide 18: 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 Proven, Consistent - Qualitative Results Only firm ranked in the top 12 each year for the last 8 ~35% of analysts initially joined as associates
Slide 19: Institutional Group – Equity Sales and Trading
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 20: Institutional Group – Fixed Income
Institutional Group – Fixed Income Strong Fixed Income Capital Markets Capabilities Overview Client Distribution Comprehensive platform Approximately 50 traders averaging 14 years of experience Money Other Manager Annual client trade volume approximately $275 7% billion 34% No proprietary tr
Slide 21: Institutional Group – Investment Banking
Institutional Group – Investment Banking Accomplished U.S. Equity Underwriting Franchise – All Equity Transactions All Managed Equity Deals Since 2005 Bookrun Equity Deals Since 2005 ($ in billions) # of $ ($ in billions) # of % $ Rank Firm Deals Volume Rank Firm Deals Bookrun Volume 1 Bank of Ameri
Slide 22: IV. Second Quarter 2011 Financial Results
IV. Second Quarter 2011 Financial Results
Slide 23: Quarterly Results: Core Net Revenues
Stifel Financial Overview Quarterly Results Core Net Revenues ($MM) and Pre-Tax Margins(1) $500 25% $403 Core Pre-Tax Margins $400 $367 $359 20% Core Net Revenues $319 $312 $328 $341 $290 19% $300 $262 15% $220 15% 15% 13% 13% 13% 14% $200 10% 10% 10% 11% $100 5% $0 0% 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10
Slide 24: Stifel Financial Corp. Results
Stifel Financial Corp. Results Six months ended June 30, 2011 Six Months Ended June 30, 2011 Six Months Ended 6/30/10 % ($ in thousands, except per share amounts) GAAP Non-core (1) Non-GAAP (Non-GAAP) Change (2) Net revenues $ 725,470 $ 112 $ 725,582 $ 640,039 13.4% Compensation and benefits 461,105
Slide 25: Sources of Revenues
Sources of Revenues Six Months Ended % ($ in thousands) 6/30/11 6/30/10 Change Commissions $ 294,101 $ 208,669 40.9% Principal transactions 172,600 240,343 (28.2%) Asset mgt and service fees 114,661 85,241 34.5% Investment banking 105,836 75,473 40.2% Other 10,812 5,702 89.6% Total operating revenue
Slide 26: Brokerage Revenues
Brokerage Revenues Six Months Ended % ($ in thousands) 6/30/11 6/30/10 Change Taxable debt $ 94,439 $ 124,798 (24.3%) Municipal debt 38,388 36,874 4.1% Equities 20,519 51,915 (60.5%) Other 19,254 26,756 (28.0%) $ 172,600 $ 240,343 (28.2%) Commissions 294,101 208,669 40.9% $ 466,701 $ 449,012 3.9% 26
Slide 27: Segment Comparison
Segment Comparison Six Months Ended % ($ in thousands) 6/30/11 6/30/10 Change Net revenues: Global Wealth Management $ 464,091 $ 399,361 16.2% Institutional Group 259,909 237,894 9.3% Other 1,582 2,784 (43.2%) $ 725,582 $ 640,039 13.4% Operating contribution: Global Wealth Management $ 116,898 $ 79,
Slide 28: Statement of Financial Condition
Statement of Financial Condition As of June 30, 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 $0.3 $0.6 $0.1 $0.4 $0.1 $
Slide 29: V. Conclusion
STIFEL FINANCIAL
Slide 30: Opportunities Drive our Growth
Opportunities Drive our Growth Stifel is Well-Positioned to Take Advantage of Opportunities Strategic Initiatives Attract and retain high-quality talent Continue building client facing, agency-only businesses Continue to expand private client footprint in the U.S. Continue to expand institut