Jefferies Financial Group’s JEF first-quarter fiscal 2026 (ended Feb. 28) adjusted earnings per share from continuing operations of 89 cents were in line with the Zacks Consensus Estimate. The bottom line jumped 45.9% year over year.
Results were aided by record Investment Banking revenues, strength in Equities and improved Asset Management investment returns. However, lower Fixed Income results, a goodwill write-down associated with Tessellis and losses tied to Market Financial Solutions and First Brands acted as headwinds.
Results included certain non-recurring charges. After considering these, net earnings attributable to common shareholders (GAAP) increased 21.8% to $155.7 million.
Jefferies’ Revenues Rise, Expenses Increase
Quarterly net revenues were $2.02 billion, up from $1.59 billion in the prior-year quarter. The top line marginally beat the Zacks Consensus Estimate of $2.01 billion.
Total quarterly non-interest expenses were $1.80 billion, up from $1.44 billion in the year-ago quarter. Higher compensation and benefits expenses, brokerage and clearing fees, technology and communications expenses, and a write-down associated with Tessellis were the main reasons behind the increase.
As of Feb. 28, 2026, book value per common share was $51.91, up from $49.48 as of Feb. 28, 2025. Furthermore, adjusted tangible book value per fully diluted share increased from $32.57 to $34.24.
JEF’s Balance Sheet Solid
As of Feb. 28, 2026, total assets were $74.38 billion, down from $76.01 billion as of Nov. 30, 2025, while total shareholders’ equity was $10.61 billion, up modestly from $10.58 billion.
The leverage ratio was 7.0 compared with 6.8 in the prior-year quarter, and the tangible gross leverage ratio was 8.4 compared with 8.3.
Return on adjusted tangible shareholders’ equity was 10.9%, up from 8.0% in the prior-year quarter.
JEF’s Quarterly Segment Performance
Investment Banking and Capital Markets: Net revenues were $1.80 billion, rising 28.4% from the prior-year quarter. Investment Banking net revenues were $1.02 billion, up from $700.7 million, driven by higher advisory and equity underwriting revenues, while debt underwriting remained solid but was lower year over year. Capital Markets net revenues were $778.8 million, up from $698.3 million, as Equities net revenues rose 36.5%, partially offset by a decline in Fixed Income net revenues.
Asset Management: Net revenues were $220.3 million, up from $191.7 million in the year-ago quarter. Asset management fees and revenues declined year over year, but investment return soared significantly, driven by improved performance across several fund strategies, particularly those with a long equity bias. Results also included a final $10 million pre-tax loss that fully wrote off Jefferies’ direct exposure to First Brands.
JEF’s Share Repurchase Update
In the reported quarter, Jefferies repurchased 3.0 million common shares for $174 million, at an average price of $58.18 per share.
Its board also increased the share buyback authorization to a total of $250 million.
Our Take on Jefferies
Private credit concerns, a lawsuit for breach of contract related to loans tied to the collapse of First Brands and geopolitical upheaval are some of the near-term headwinds faced by JEF. While expense pressure was evident, management highlighted ongoing technology investments, market share gains and initiatives aimed at supporting long-term growth.
Jefferies Financial Group Inc. Price, Consensus and EPS Surprise
Jefferies Financial Group Inc. price-consensus-eps-surprise-chart | Jefferies Financial Group Inc. Quote
At present, Jefferies carries a Zacks Rank #5 (Strong Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Earnings Dates of JEF’s Peers
JPMorgan JPM is scheduled to report first-quarter 2026 results on April 14.
Over the past 30 days, the Zacks Consensus Estimate for JPMorgan’s quarterly earnings has been revised upward to $5.42. The estimated figure indicates 6.9% growth from the prior-year quarter.
Bank of America BAC is slated to announce first-quarter 2026 results on April 15.
Over the past 30 days, the Zacks Consensus Estimate for BAC’s quarterly earnings has been revised north to 99 cents. This implies a 10% rise from the prior-year quarter.
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This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
