Piper Sandler Companies (PIPR) Q3 2024 earnings summary

Executive summary

• Q3 2024 net revenues rose 24% year-over-year to $360 million, with strong growth in advisory and municipal financing, and adjusted EPS of $2.57.

• Adjusted net income was $46.3 million, or $2.57 per diluted share, up 47% year-over-year; GAAP net income was $34.8 million, up 797%.

• Completed the acquisition of Aviditi Advisors in August 2024, expanding private capital advisory and adding 41 professionals.

• Diversification in sector and product offerings continues to drive performance and resilience.

Financial highlights

• Q3 2024 GAAP net revenues: $359.6 million, up 24% year-over-year and 6% sequentially.

• Adjusted net revenues: $351.8 million, up 15% year-over-year.

• Q3 2024 net income: $34.8 million; adjusted net income: $46.3 million; adjusted EPS: $2.57.

• Compensation ratio for Q3 was 62.5% (adjusted), down year-over-year; GAAP compensation ratio was 64.2%.

• Declared a quarterly dividend of $0.65 per share; $121 million returned to shareholders year-to-date via dividends and repurchases.

Outlook and guidance

• Q4 2024 revenues expected to be similar to or better than Q4 2023, with strong starts in advisory, ECM, and other business lines.

• Anticipate continued improvement in fixed income and public finance, with strong finishes expected for the year.

• Gradual improvement in private equity sponsor activity expected to continue into 2025.

• Compensation ratio guidance for 2025 remains in the 61.5%-62.5% range, barring significant investments.

• Forward-looking statements highlight potential for further growth but caution on macroeconomic and market risks.