Intrinsic value of Raymond James Financial - RJF

Previous Close

$83.78

  Intrinsic Value

$480.23

stock screener

  Rating & Target

str. buy

+473%

Previous close

$83.78

 
Intrinsic value

$480.23

 
Up/down potential

+473%

 
Rating

str. buy

Our model is not good at valuating stocks of financial companies, such as RJF.

We calculate the intrinsic value of RJF stock by summing up the current values of future distributable cash flows generated by the company and dividing the sum by the number of outstanding shares. As such, the intrinsic value calculation depends entirely on projections. The more accurate your projections of the company's performance are - the more reliable is the intrinsic value calculation result. Please make sure to check the stock valuation input data below and adjust it if necessary. The quality of the output (intrinsic valuation result) is only as good as the quality of the input. See also DISCLAIMERS.

STOCK VALUATION INPUT DATA

Revenue (in 2016), $M
Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Variable cost ratio, %
Fixed operating expenses, $M
Interest rate on debt, %
Effective corporate tax rate, %
Production assets / Revenue, %
Life of production assets, yrs
Working capital / Revenue, %
Revenue / Adjusted assets
Adjusted equity ratio
Cash flow adjustment, % of Revenue
Book value of equity, $M
Shares outstanding, mln
Market capitalization, $bln 12.1

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
2016(a)
   2017
   2018
   2019
   2020
   2021
   2022
   2023
   2024
   2025
   2026
   2027
   2028
   2029
   2030
   2031
   2032
   2033
   2034
   2035
   2036
   2037
   2038
   2039
   2040
   2041
   2042
   2043
   2044
   2045
   2046

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  3.99
  19.90
  18.41
  17.07
  15.86
  14.78
  13.80
  12.92
  12.13
  11.41
  10.77
  10.20
  9.68
  9.21
  8.79
  8.41
  8.07
  7.76
  7.48
  7.24
  7.01
  6.81
  6.63
  6.47
  6.32
  6.19
  6.07
  5.96
  5.87
  5.78
  5.70
Revenue, $m
  5,520
  6,618
  7,837
  9,175
  10,630
  12,201
  13,884
  15,678
  17,579
  19,585
  21,695
  23,907
  26,220
  28,635
  31,151
  33,770
  36,495
  39,327
  42,271
  45,330
  48,508
  51,813
  55,248
  58,821
  62,539
  66,409
  70,440
  74,640
  79,019
  83,586
  88,352
Variable operating expenses, $m
 
  5,644
  6,676
  7,808
  9,040
  10,370
  11,795
  13,314
  14,923
  16,622
  18,408
  20,240
  22,198
  24,242
  26,373
  28,590
  30,897
  33,295
  35,787
  38,376
  41,068
  43,865
  46,773
  49,798
  52,946
  56,222
  59,635
  63,191
  66,898
  70,764
  74,799
Fixed operating expenses, $m
 
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total operating expenses, $m
  4,743
  5,644
  6,676
  7,808
  9,040
  10,370
  11,795
  13,314
  14,923
  16,622
  18,408
  20,240
  22,198
  24,242
  26,373
  28,590
  30,897
  33,295
  35,787
  38,376
  41,068
  43,865
  46,773
  49,798
  52,946
  56,222
  59,635
  63,191
  66,898
  70,764
  74,799
Operating income, $m
  777
  974
  1,161
  1,367
  1,590
  1,831
  2,089
  2,364
  2,656
  2,963
  3,287
  3,667
  4,022
  4,392
  4,778
  5,180
  5,598
  6,032
  6,484
  6,953
  7,441
  7,948
  8,475
  9,023
  9,593
  10,187
  10,805
  11,449
  12,121
  12,821
  13,552
EBITDA, $m
  849
  1,047
  1,240
  1,451
  1,682
  1,930
  2,196
  2,480
  2,781
  3,098
  3,432
  3,782
  4,148
  4,530
  4,928
  5,342
  5,774
  6,222
  6,687
  7,171
  7,674
  8,197
  8,740
  9,306
  9,894
  10,506
  11,144
  11,808
  12,501
  13,223
  13,977
Interest expense (income), $m
  114
  112
  369
  655
  968
  1,309
  1,676
  2,071
  2,490
  2,936
  3,405
  3,899
  4,417
  4,959
  5,524
  6,113
  6,727
  7,365
  8,028
  8,717
  9,433
  10,177
  10,951
  11,755
  12,592
  13,463
  14,369
  15,312
  16,296
  17,321
  18,390
Earnings before tax, $m
  777
  862
  792
  712
  622
  522
  413
  294
  165
  28
  -118
  -232
  -395
  -567
  -746
  -933
  -1,129
  -1,332
  -1,544
  -1,764
  -1,992
  -2,230
  -2,477
  -2,733
  -2,999
  -3,276
  -3,564
  -3,863
  -4,175
  -4,500
  -4,838
Tax expense, $m
  271
  233
  214
  192
  168
  141
  111
  79
  45
  8
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Net income, $m
  529
  629
  578
  520
  454
  381
  301
  214
  121
  20
  -118
  -232
  -395
  -567
  -746
  -933
  -1,129
  -1,332
  -1,544
  -1,764
  -1,992
  -2,230
  -2,477
  -2,733
  -2,999
  -3,276
  -3,564
  -3,863
  -4,175
  -4,500
  -4,838

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  1,650
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total assets, $m
  31,487
  35,776
  42,362
  49,593
  57,459
  65,949
  75,049
  84,744
  95,021
  105,866
  117,271
  129,227
  141,731
  154,782
  168,383
  182,542
  197,269
  212,579
  228,490
  245,024
  262,207
  280,068
  298,637
  317,951
  338,047
  358,967
  380,755
  403,459
  427,127
  451,814
  477,576
Adjusted assets (=assets-cash), $m
  29,837
  35,776
  42,362
  49,593
  57,459
  65,949
  75,049
  84,744
  95,021
  105,866
  117,271
  129,227
  141,731
  154,782
  168,383
  182,542
  197,269
  212,579
  228,490
  245,024
  262,207
  280,068
  298,637
  317,951
  338,047
  358,967
  380,755
  403,459
  427,127
  451,814
  477,576
Revenue / Adjusted assets
  0.185
  0.185
  0.185
  0.185
  0.185
  0.185
  0.185
  0.185
  0.185
  0.185
  0.185
  0.185
  0.185
  0.185
  0.185
  0.185
  0.185
  0.185
  0.185
  0.185
  0.185
  0.185
  0.185
  0.185
  0.185
  0.185
  0.185
  0.185
  0.185
  0.185
  0.185
Average production assets, $m
  211
  252
  298
  349
  404
  464
  528
  596
  668
  744
  824
  908
  996
  1,088
  1,184
  1,283
  1,387
  1,494
  1,606
  1,723
  1,843
  1,969
  2,099
  2,235
  2,376
  2,524
  2,677
  2,836
  3,003
  3,176
  3,357
Working capital, $m
  0
  -1,747
  -2,069
  -2,422
  -2,806
  -3,221
  -3,665
  -4,139
  -4,641
  -5,171
  -5,728
  -6,311
  -6,922
  -7,560
  -8,224
  -8,915
  -9,635
  -10,382
  -11,159
  -11,967
  -12,806
  -13,679
  -14,585
  -15,529
  -16,510
  -17,532
  -18,596
  -19,705
  -20,861
  -22,067
  -23,325
Total debt, $m
  2,482
  7,538
  13,360
  19,752
  26,706
  34,211
  42,255
  50,826
  59,910
  69,498
  79,579
  90,149
  101,202
  112,739
  124,762
  137,279
  150,297
  163,831
  177,897
  192,514
  207,703
  223,492
  239,907
  256,981
  274,746
  293,239
  312,500
  332,569
  353,493
  375,316
  398,089
Total liabilities, $m
  26,570
  31,626
  37,448
  43,840
  50,794
  58,299
  66,343
  74,914
  83,998
  93,586
  103,667
  114,237
  125,290
  136,827
  148,850
  161,367
  174,385
  187,919
  201,985
  216,602
  231,791
  247,580
  263,995
  281,069
  298,834
  317,327
  336,588
  356,657
  377,581
  399,404
  422,177
Total equity, $m
  4,917
  4,150
  4,914
  5,753
  6,665
  7,650
  8,706
  9,830
  11,022
  12,280
  13,603
  14,990
  16,441
  17,955
  19,532
  21,175
  22,883
  24,659
  26,505
  28,423
  30,416
  32,488
  34,642
  36,882
  39,213
  41,640
  44,168
  46,801
  49,547
  52,410
  55,399
Total liabilities and equity, $m
  31,487
  35,776
  42,362
  49,593
  57,459
  65,949
  75,049
  84,744
  95,020
  105,866
  117,270
  129,227
  141,731
  154,782
  168,382
  182,542
  197,268
  212,578
  228,490
  245,025
  262,207
  280,068
  298,637
  317,951
  338,047
  358,967
  380,756
  403,458
  427,128
  451,814
  477,576
Debt-to-equity ratio
  0.505
  1.820
  2.720
  3.430
  4.010
  4.470
  4.850
  5.170
  5.440
  5.660
  5.850
  6.010
  6.160
  6.280
  6.390
  6.480
  6.570
  6.640
  6.710
  6.770
  6.830
  6.880
  6.930
  6.970
  7.010
  7.040
  7.080
  7.110
  7.130
  7.160
  7.190
Adjusted equity ratio
  0.116
  0.116
  0.116
  0.116
  0.116
  0.116
  0.116
  0.116
  0.116
  0.116
  0.116
  0.116
  0.116
  0.116
  0.116
  0.116
  0.116
  0.116
  0.116
  0.116
  0.116
  0.116
  0.116
  0.116
  0.116
  0.116
  0.116
  0.116
  0.116
  0.116
  0.116

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  529
  629
  578
  520
  454
  381
  301
  214
  121
  20
  -118
  -232
  -395
  -567
  -746
  -933
  -1,129
  -1,332
  -1,544
  -1,764
  -1,992
  -2,230
  -2,477
  -2,733
  -2,999
  -3,276
  -3,564
  -3,863
  -4,175
  -4,500
  -4,838
Depreciation, amort., depletion, $m
  72
  73
  78
  85
  92
  99
  108
  116
  125
  135
  145
  115
  126
  138
  150
  162
  176
  189
  203
  218
  233
  249
  266
  283
  301
  319
  339
  359
  380
  402
  425
Funds from operations, $m
  -1,306
  702
  657
  605
  546
  481
  409
  330
  246
  155
  27
  -117
  -269
  -429
  -596
  -771
  -953
  -1,143
  -1,340
  -1,546
  -1,759
  -1,981
  -2,211
  -2,450
  -2,698
  -2,957
  -3,225
  -3,504
  -3,795
  -4,098
  -4,413
Change in working capital, $m
  -788
  -290
  -322
  -353
  -384
  -415
  -444
  -474
  -502
  -530
  -557
  -584
  -611
  -637
  -664
  -692
  -719
  -748
  -777
  -808
  -839
  -872
  -907
  -943
  -982
  -1,022
  -1,064
  -1,109
  -1,156
  -1,206
  -1,258
Cash from operations, $m
  -518
  992
  978
  958
  930
  895
  853
  804
  748
  685
  584
  467
  341
  209
  68
  -79
  -234
  -395
  -563
  -738
  -920
  -1,108
  -1,304
  -1,507
  -1,717
  -1,935
  -2,161
  -2,396
  -2,639
  -2,892
  -3,155
Maintenance CAPEX, $m
  0
  -27
  -32
  -38
  -44
  -51
  -59
  -67
  -75
  -85
  -94
  -104
  -115
  -126
  -138
  -150
  -162
  -176
  -189
  -203
  -218
  -233
  -249
  -266
  -283
  -301
  -319
  -339
  -359
  -380
  -402
New CAPEX, $m
  -122
  -41
  -46
  -51
  -55
  -60
  -64
  -68
  -72
  -76
  -80
  -84
  -88
  -92
  -96
  -100
  -104
  -108
  -112
  -116
  -121
  -126
  -131
  -136
  -141
  -147
  -153
  -160
  -166
  -174
  -181
Cash from investing activities, $m
  -2,982
  -68
  -78
  -89
  -99
  -111
  -123
  -135
  -147
  -161
  -174
  -188
  -203
  -218
  -234
  -250
  -266
  -284
  -301
  -319
  -339
  -359
  -380
  -402
  -424
  -448
  -472
  -499
  -525
  -554
  -583
Free cash flow, $m
  -3,500
  924
  900
  869
  831
  784
  731
  669
  600
  524
  409
  278
  139
  -9
  -165
  -329
  -500
  -678
  -864
  -1,058
  -1,259
  -1,467
  -1,684
  -1,908
  -2,141
  -2,383
  -2,634
  -2,894
  -3,164
  -3,446
  -3,738
Issuance/(repayment) of debt, $m
  2,776
  5,249
  5,822
  6,392
  6,954
  7,505
  8,044
  8,571
  9,085
  9,588
  10,082
  10,569
  11,053
  11,537
  12,024
  12,516
  13,019
  13,534
  14,066
  14,616
  15,190
  15,788
  16,415
  17,073
  17,765
  18,493
  19,261
  20,070
  20,923
  21,823
  22,773
Issuance/(repurchase) of shares, $m
  -119
  61
  186
  319
  459
  604
  754
  910
  1,072
  1,238
  1,441
  1,619
  1,846
  2,080
  2,324
  2,576
  2,837
  3,108
  3,390
  3,682
  3,986
  4,302
  4,631
  4,973
  5,330
  5,703
  6,091
  6,497
  6,921
  7,364
  7,826
Cash from financing (excl. dividends), $m  
  2,692
  5,310
  6,008
  6,711
  7,413
  8,109
  8,798
  9,481
  10,157
  10,826
  11,523
  12,188
  12,899
  13,617
  14,348
  15,092
  15,856
  16,642
  17,456
  18,298
  19,176
  20,090
  21,046
  22,046
  23,095
  24,196
  25,352
  26,567
  27,844
  29,187
  30,599
Total cash flow (excl. dividends), $m
  -838
  6,234
  6,908
  7,580
  8,243
  8,893
  9,529
  10,150
  10,756
  11,350
  11,932
  12,467
  13,038
  13,608
  14,182
  14,763
  15,356
  15,964
  16,591
  17,240
  17,917
  18,623
  19,362
  20,138
  20,954
  21,813
  22,718
  23,673
  24,679
  25,741
  26,862
Retained Cash Flow (-), $m
  -395
  -690
  -764
  -839
  -913
  -985
  -1,056
  -1,125
  -1,192
  -1,258
  -1,441
  -1,619
  -1,846
  -2,080
  -2,324
  -2,576
  -2,837
  -3,108
  -3,390
  -3,682
  -3,986
  -4,302
  -4,631
  -4,973
  -5,330
  -5,703
  -6,091
  -6,497
  -6,921
  -7,364
  -7,826
Prev. year cash balance distribution, $m
 
  1,457
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash flow adjustment, $m
 
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash available for distribution, $m
 
  7,001
  6,144
  6,742
  7,331
  7,909
  8,474
  9,025
  9,564
  10,091
  10,491
  10,847
  11,192
  11,528
  11,858
  12,188
  12,519
  12,856
  13,201
  13,559
  13,931
  14,321
  14,732
  15,165
  15,624
  16,111
  16,627
  17,176
  17,759
  18,378
  19,035
Discount rate, %
 
  4.80
  5.04
  5.29
  5.56
  5.83
  6.13
  6.43
  6.75
  7.09
  7.45
  7.82
  8.21
  8.62
  9.05
  9.50
  9.98
  10.48
  11.00
  11.55
  12.13
  12.74
  13.37
  14.04
  14.74
  15.48
  16.25
  17.07
  17.92
  18.82
  19.76
PV of cash for distribution, $m
 
  6,680
  5,569
  5,775
  5,905
  5,956
  5,931
  5,834
  5,670
  5,447
  5,116
  4,739
  4,342
  3,935
  3,525
  3,122
  2,733
  2,363
  2,017
  1,699
  1,411
  1,155
  931
  739
  576
  441
  331
  244
  176
  124
  85
Current shareholders' claim on cash, %
  100
  99.3
  97.5
  95.0
  92.0
  88.7
  85.3
  81.8
  78.4
  74.9
  71.5
  68.2
  65.0
  61.8
  58.7
  55.7
  52.8
  50.0
  47.4
  44.9
  42.4
  40.1
  37.9
  35.8
  33.8
  31.9
  30.2
  28.4
  26.8
  25.3
  23.9

Raymond James Financial, Inc. (RJF) is a financial holding company. The Company's subsidiaries include Raymond James & Associates, Inc. (RJ&A), Raymond James Financial Services, Inc. (RJFS), Raymond James Financial Services Advisors, Inc. (RJFSA), Raymond James Ltd. (RJ Ltd.), Eagle Asset Management, Inc. (Eagle), and Raymond James Bank, N.A. (RJ Bank). It operates through five segments: Private Client Group (PCG), Capital Markets, Asset Management, RJ Bank and the Other segment. The Private Client Group segment includes the retail branches of the Company's broker-dealer subsidiaries located throughout the United States, Canada and the United Kingdom. The Capital Markets segment includes institutional sales and trading in the United States, Canada and Europe. The Asset Management segment includes the operations of Eagle, the Eagle Family of Funds and other fee-based asset management programs. RJ Bank segment provides corporate loan, securities based loans (SB) and residential loans.

FINANCIAL RATIOS  of  Raymond James Financial (RJF)

Valuation Ratios
P/E Ratio 22.4
Price to Sales 2.1
Price to Book 2.4
Price to Tangible Book
Price to Cash Flow -22.9
Price to Free Cash Flow -18.5
Growth Rates
Sales Growth Rate 4%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 64.9%
Cap. Spend. - 3 Yr. Gr. Rate 10.8%
Financial Strength
Quick Ratio 9
Current Ratio NaN
LT Debt to Equity 46.6%
Total Debt to Equity 50.5%
Interest Coverage 8
Management Effectiveness
Return On Assets 2.1%
Ret/ On Assets - 3 Yr. Avg. 2.2%
Return On Total Capital 7.5%
Ret/ On T. Cap. - 3 Yr. Avg. 7.9%
Return On Equity 11.2%
Return On Equity - 3 Yr. Avg. 11.7%
Asset Turnover 0.2
Profitability Ratios
Gross Margin 96.8%
Gross Margin - 3 Yr. Avg. 96.8%
EBITDA Margin 17.4%
EBITDA Margin - 3 Yr. Avg. 17.7%
Operating Margin 14.1%
Oper. Margin - 3 Yr. Avg. 14.4%
Pre-Tax Margin 14.1%
Pre-Tax Margin - 3 Yr. Avg. 14.4%
Net Profit Margin 9.6%
Net Profit Margin - 3 Yr. Avg. 9.6%
Effective Tax Rate 34.9%
Eff/ Tax Rate - 3 Yr. Avg. 36.8%
Payout Ratio 21.4%

RJF stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the RJF stock intrinsic value calculation we used $5520 million for the last fiscal year's total revenue generated by Raymond James Financial. The default revenue input number comes from 2016 income statement of Raymond James Financial. You may change it if you feel that it should be adjusted for some unusual circumstances that are not expected to be repeated in the future or if you already know (from interim financial statements, for example) that this year's revenue is going to be quite different.

Revenue growth rate. Forecasted future revenue growth rate is the most important input parameter for the intrinsic value calculation. Unlike other input parameters that are reasonably expected to be in line with their historic averages or their historic trends, the revenue growth rate by and large is a wild card: nobody really knows what the company's revenue will be in the future. Of course, the level of unpredictability is different for different industries (utility companies being the most predictable and, thus, less risky).
    We use three input parameters to forecast the revenue growth rate in our RJF stock valuation model: a) initial revenue growth rate of 19.9% whose default value is the revenue growth rate in the most recent quarter compared to the quarterly revenue a year ago; b) terminal revenue growth rate of 5% whose default value is chosen to be close to the average nominal (i.e. not adjusted for inflation) GDP growth rate; and c) revenue decline factor of 0.9, which stipulates that revenue growth rate in each forecasted year will be equal to the difference of the revenue growth rate in the preceding year and the terminal revenue growth rate multiplied by this revenue decline factor (with the passage of time the revenue growth rate will be approaching the terminal revenue growth rate, but not quite reaching it - though the difference could be infinitesimally small).
    At the revenue decline factor of 1, the future revenue growth rate is forecasted to be constant and equal to the initial revenue growth rate. The smaller the revenue decline factor, the faster the revenue growth rate will approach the terminal revenue growth.

Discount rate. The discount rate is used for determining the present value of future cash flows: future cash flows are "discounted" as at normal conditions (that translate into positive expected return on investment) one dollar today is worth more than the same dollar in the future. Unlike all other valuation models, we use variable discount rate, i.e. it increases for each consecutive year. This is done to account for higher risk of cash flows coming in further in the future.
    The initial discount rate of 4.8%, whose default value for RJF is calculated based on our internal credit rating of Raymond James Financial, is applied to the cash flow expected to be received a year from now (well, actually, to be precise, in the financial year following the base year - the last year for which we have financial statements). For each consecutive year the discount rate is multiplied by the discount rate multiplier of 1.05, e.i. each year it increases by 5%. Feel free to change this number to correspond to your level of risk assessment of Raymond James Financial.
    By the way, it is easy to set the discount rate to be constant (this would make comparison with other valuation models easier): just set the discount rate multiplier equal to 1 and chose the magnitude of the initial discount rate to your liking.

Variable cost ratio is the ratio of variable costs (i.e. costs that fluctuate with fluctuation of the volume of production) to the revenue expressed as a percentage. In the calculation of intrinsic value of RJF stock the variable cost ratio is equal to 85.4%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $0 million in the base year in the intrinsic value calculation for RJF stock. These expenses increase with the level of inflation in subsequent years.

Interest rate on debt is the average all-in rate of interest paid by the company on its debt. It is set at 4.9% for Raymond James Financial.

Corporate tax rate of 27% is the nominal tax rate for Raymond James Financial. In reality, companies find ways to pay much less taxes than that or not to pay them at all.

Cash flow adjustment could be used for any adjustment the investor deems necessary. Most commonly we use this field to account for stock options-related effects in excess of what is reported on the company's income statement. The cash flow adjustment is expressed as a percentage of the revenue, and in the current valuation of the RJF stock is equal to 0%.

Production assets are the company's assets used for manufacturing products or provision of services. In the valuation model input table they are expressed as a percentage of revenue and for RJF are equal to 3.8%.

Life of production assets of 7.9 years is the average useful life of capital assets used in Raymond James Financial operations. It is used to calculate yearly capital expenditures needed to keep these assets in good order - we call it the maintenance CAPEX.

Working capital is the difference between the company's current assets and liabilities. In the model we use the ratio of working capital to revenue, which for RJF is equal to -26.4%. A negative number means that the company is apt at using financial resources of its suppliers and customers; a large positive number, on the other hand, means that it either provides in-kind financing to others or is not good at managing its inventories.

Book value of equity - $4917 million for Raymond James Financial - is used in calculation of the "floor" for intrinsic valuation based on the discounted cash flow (DCF) method. Even if the prospects are very bad for a company, its assets could always be sold now for their current fair market value.

Shares outstanding of 144.176 million for Raymond James Financial is needed to calculate the intrinsic value of one share.

Market capitalization is used here only for reference purposes and as a quick check that the share price and the number of shares outstanding numbers are correct - something especially to be cognizant about at stock splits. So, the market capitalization of Raymond James Financial at the current share price and the inputted number of shares is $12.1 billion.

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PRI Primerica 97.95 288.78  str.buy
SF Stifel Financi 52.10 215.00  str.buy
SCHW Charles Schwab 44.68 83.88  str.buy

COMPANY NEWS

▶ Raymond James CEO on Expansion Push, Tax Reform   [Nov-17-17 04:33PM  Bloomberg Video]
▶ Stocks With Rising Relative Strength: Raymond James Financial   [Nov-03-17 03:00AM  Investor's Business Daily]
▶ Giddis Says Market Moving Data Will Come Later This Week   [Oct-30-17 11:23AM  Bloomberg Video]
▶ Raymond James posts 4Q profit   [Oct-25-17 06:05PM  Associated Press]
▶ Why Raymond James Financial Inc (RJF) Could Be A Buy   [Oct-19-17 02:17PM  Simply Wall St.]
▶ Heres how Oranjs 'un-robo-advisor' saves you money   [Oct-10-17 01:21PM  Yahoo Finance Video]
▶ Deregulation is driving bank stocks highernot the Fed: NYSE trader   [Oct-09-17 01:05PM  Yahoo Finance Video]
▶ [$$] Finance Chiefs Have Longer Tenures, and That Is Good for Companies   [Aug-13-17 08:00AM  The Wall Street Journal]
▶ Raymond James posts 3Q profit   [Jul-26-17 11:24PM  Associated Press]
▶ PEG Ratio vs. the P/E Ratio   [Jul-25-17 02:32PM  Zacks]
▶ Oil Analyst Molchanov Is Watching Global Inventory   [Jun-21-17 09:06AM  Bloomberg Video]
▶ 4 Surging Finance Stocks With Solid Dividends   [Jun-20-17 04:36PM  Zacks]
▶ Raymond James CEO: Trump's corporate tax cut is too deep   [10:35AM  American City Business Journals]
▶ Raymond James Initiates Coverage of Newmont Mining   [Jun-16-17 05:04PM  GuruFocus.com]
▶ As BofA, Morgan Stanley Rise, Raymond James Also Nears Breakout   [Jun-09-17 12:26PM  Investor's Business Daily]
▶ St. Pete agrees to $2 million road improvement to accommodate 650 new jobs   [Jun-01-17 01:30PM  American City Business Journals]
▶ BankUnited regains title as the most profitable bank in Florida   [May-25-17 02:05PM  American City Business Journals]
▶ [$$] Raymond James Nabs $400 Million Merrill Broker   [May-02-17 05:49PM  The Wall Street Journal]
▶ Raymond James posts 2Q profit   [Apr-26-17 07:14PM  Associated Press]
▶ Raymond James strikes $172M deal to buy Kansas City investment manager   [Apr-20-17 08:40AM  American City Business Journals]
▶ Why a major credit agency is keeping an eye on Raymond James   [Apr-18-17 02:05PM  American City Business Journals]
▶ Raymond James agrees to multimillion-dollar settlement in Vermont ski resort suits   [Apr-14-17 12:53PM  American City Business Journals]
▶ New Strong Buy Stocks for April 10th   [Apr-10-17 09:07AM  Zacks]
Financial statements of RJF
Valuation of Stocks

The paper VALUATION OF STOCKS: The Quest for Intrinsic Value provides a detailed description of our valuation model and discloses the calculation algorithm.

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