Investors are often guided by the idea of discovering ‘the next big thing’, even if that means buying ‘story stocks’ without any revenue, let alone profit. But as Peter Lynch said in One Up On Wall Street, ‘Long shots almost never pay off.’ Loss making companies can act like a sponge for capital – so investors should be cautious that they’re not throwing good money after bad.
In contrast to all that, many investors prefer to focus on companies like Raymond James Financial (NYSE:RJF), which has not only revenues, but also profits. Even if this company is fairly valued by the market, investors would agree that generating consistent profits will continue to provide Raymond James Financial with the means to add long-term value to shareholders.
If a company can keep growing earnings per share (EPS) long enough, its share price should eventually follow. That makes EPS growth an attractive quality for any company. We can see that in the last three years Raymond James Financial grew its EPS by 14% per year. That’s a good rate of growth, if it can be sustained.
It’s often helpful to take a look at earnings before interest and tax (EBIT) margins, as well as revenue growth, to get another take on the quality of the company’s growth. It’s noted that Raymond James Financial’s revenue from operations was lower than its revenue in the last twelve months, so that could distort our analysis of its margins. While we note Raymond James Financial achieved similar EBIT margins to last year, revenue grew by a solid 12% to US$14b. That’s progress.
The chart below shows how the company’s bottom and top lines have progressed over time. To see the actual numbers, click on the chart.
NYSE:RJF Earnings and Revenue History August 9th 2025
Owing to the size of Raymond James Financial, we wouldn’t expect insiders to hold a significant proportion of the company. But we are reassured by the fact they have invested in the company. Indeed, they have a considerable amount of wealth invested in it, currently valued at US$3.6b. Holders should find this level of insider commitment quite encouraging, since it would ensure that the leaders of the company would also experience their success, or failure, with the stock.
It means a lot to see insiders invested in the business, but shareholders may be wondering if remuneration policies are in their best interest. Our quick analysis into CEO remuneration would seem to indicate they are. Our analysis has discovered that the median total compensation for the CEOs of companies like Raymond James Financial, with market caps over US$8.0b, is about US$14m.
Raymond James Financial’s CEO took home a total compensation package worth US$7.1m in the year leading up to September 2024. That seems pretty reasonable, especially given it’s below the median for similar sized companies. CEO compensation is hardly the most important aspect of a company to consider, but when it’s reasonable, that gives a little more confidence that leadership are looking out for shareholder interests. It can also be a sign of good governance, more generally.
As previously touched on, Raymond James Financial is a growing business, which is encouraging. The growth of EPS may be the eye-catching headline for Raymond James Financial, but there’s more to bring joy for shareholders. With company insiders aligning themselves considerably with the company’s success and modest CEO compensation, there’s no arguments that this is a stock worth looking into. If you think Raymond James Financial might suit your style as an investor, you could go straight to its annual report, or you could first check our discounted cash flow (DCF) valuation for the company.
Please note the insider transactions discussed in this article refer to reportable transactions in the relevant jurisdiction.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
