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Piper Sandler (PIPR)
NYSE:PIPR

Piper Sandler (PIPR) AI Stock Analysis

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Piper Sandler

(NYSE:PIPR)

71Outperform
Piper Sandler's overall score reflects strong financial performance and positive earnings outlook, offset by bearish technical indicators. The company's robust revenue growth, zero debt, and profitability are key strengths, while the current bearish technical trend and moderate valuation present challenges.
Positive Factors
Company Performance
Piper Sandler delivered a strong quarter with adjusted revenues significantly above estimates, indicating strong company performance.
Growth Potential
Management is confident in the ability to grow revenues and drive further operating leverage, positioning the company well for future growth.
Negative Factors
Market Uncertainty
Timely investor meetings with Piper Sandler management address recent market volatility, adding some near-term uncertainty.

Piper Sandler (PIPR) vs. S&P 500 (SPY)

Piper Sandler Business Overview & Revenue Model

Company DescriptionPiper Sandler Companies (PIPR) is a leading investment bank and institutional securities firm offering a wide range of financial services. Headquartered in Minneapolis, Minnesota, the company operates in sectors such as healthcare, financial institutions, energy, consumer, and retail, among others. Piper Sandler provides services including investment banking, public finance, institutional brokerage, and asset management, catering to corporations, private equity firms, government entities, and institutional investors.
How the Company Makes MoneyPiper Sandler makes money primarily through its investment banking and institutional securities operations. The company's revenue streams include advisory fees from mergers and acquisitions, underwriting fees from debt and equity offerings, and trading commissions from securities transactions. Additionally, Piper Sandler generates revenue from asset management fees, which are based on the assets under management (AUM) and performance of the investment funds. The company's earnings are also influenced by market conditions and economic trends, as well as its strategic partnerships and client relationships in various industries.

Piper Sandler Financial Statement Overview

Summary
Piper Sandler exhibits a solid financial performance, evidenced by strong revenue growth, robust profitability margins, and a stable balance sheet with no debt and strong equity. Cash flow metrics indicate healthy cash generation, although attention should be paid to fluctuations in gross profit margins.
Income Statement
75
Positive
Piper Sandler has demonstrated a strong income statement performance with a notable increase in revenue from $1.35 billion in 2023 to $1.53 billion in 2024, reflecting a revenue growth rate of approximately 13.6%. The gross profit margin in 2024 was approximately 34.4%, while the net profit margin was around 11.8%. The EBIT and EBITDA margins were both approximately 31.7%. These margins indicate robust profitability, although the decrease in gross profit from 2023 is a point of concern.
Balance Sheet
80
Positive
The balance sheet reveals a strong financial position with no total debt as of 2024, significantly improving from the prior year. The debt-to-equity ratio is 0, indicating no leverage, while the equity ratio stands at 54.4%, showing a solid equity base. Return on equity (ROE) is approximately 14.8%, which is healthy for the industry, reflecting efficient use of equity to generate profit.
Cash Flow
70
Positive
Piper Sandler's cash flow statement shows a positive trajectory, with free cash flow growing from $265.58 million in 2023 to $297.76 million in 2024, translating to a growth rate of approximately 12.1%. The operating cash flow to net income ratio is 1.73, indicating strong cash generation relative to net profits. However, the free cash flow to net income ratio is a high 1.64, suggesting the company is generating significant free cash flow relative to net income.
Breakdown
Dec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income StatementTotal Revenue
1.53B1.35B1.37B1.97B1.18B
Gross Profit
527.42M1.21B307.79M587.17M220.24M
EBIT
485.18M312.55M168.98M389.66M59.70M
EBITDA
251.16M0.00326.48M330.37M0.00
Net Income Common Stockholders
181.11M85.49M110.67M278.51M40.50M
Balance SheetCash, Cash Equivalents and Short-Term Investments
482.83M383.10M365.62M970.97M507.94M
Total Assets
2.26B2.14B2.18B2.57B2.00B
Total Debt
98.82M164.16M234.77M214.63M294.48M
Net Debt
-384.01M-218.93M-130.85M-756.34M-213.46M
Total Liabilities
840.16M841.51M927.53M1.34B1.07B
Stockholders Equity
1.23B1.09B1.05B1.06B829.42M
Cash FlowFree Cash Flow
297.76M265.58M-255.51M686.51M762.18M
Operating Cash Flow
313.25M275.63M-224.91M707.09M779.76M
Investing Cash Flow
-31.77M-10.05M-127.10M-20.58M-435.00M
Financing Cash Flow
-180.61M-249.59M-250.06M-223.12M-87.56M

Piper Sandler Technical Analysis

Technical Analysis Sentiment
Neutral
Last Price251.87
Price Trends
50DMA
248.22
Positive
100DMA
275.57
Negative
200DMA
279.43
Negative
Market Momentum
MACD
-1.09
Negative
RSI
58.81
Neutral
STOCH
87.81
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PIPR, the sentiment is Neutral. The current price of 251.87 is above the 20-day moving average (MA) of 229.37, above the 50-day MA of 248.22, and below the 200-day MA of 279.43, indicating a neutral trend. The MACD of -1.09 indicates Negative momentum. The RSI at 58.81 is Neutral, neither overbought nor oversold. The STOCH value of 87.81 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for PIPR.

Piper Sandler Risk Analysis

Piper Sandler disclosed 32 risk factors in its most recent earnings report. Piper Sandler reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Piper Sandler Peers Comparison

Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
EVEVR
78
Outperform
$8.36B20.4523.03%1.55%26.88%68.65%
PJPJT
75
Outperform
$4.73B24.6362.26%0.71%16.04%60.32%
71
Outperform
$4.31B23.7215.66%1.06%12.29%99.57%
70
Outperform
$4.47B16.6516.40%60.57%17.39%
LALAZ
70
Outperform
$3.54B13.7459.68%5.14%9.54%
MCMC
66
Neutral
$4.31B24.4639.98%4.59%45.14%
64
Neutral
$12.65B9.748.04%17044.64%12.65%-5.11%
* Financial Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
PIPR
Piper Sandler
251.87
49.84
24.67%
EVR
Evercore Partners
213.63
26.29
14.03%
SNEX
StoneX Group
92.81
43.52
88.29%
LAZ
Lazard
41.39
3.47
9.15%
MC
Moelis
54.81
4.62
9.21%
PJT
PJT Partners
143.51
44.74
45.30%

Piper Sandler Earnings Call Summary

Earnings Call Date:May 02, 2025
(Q1-2025)
|
% Change Since: 3.73%|
Next Earnings Date:Jul 25, 2025
Earnings Call Sentiment Neutral
The earnings call reflected a mix of positive growth in specific segments such as investment banking and public finance, but also highlighted challenges in corporate financing and market volatility affecting future outlooks. Despite growth in some areas, uncertainties and anticipated declines in advisory revenues signal a cautious sentiment.
Q1-2025 Updates
Positive Updates
Strong Start to 2025
Adjusted net revenues of $383 million, a 17.9% operating margin, and adjusted EPS of $4.09, all up compared to the same period last year.
Increase in Corporate Investment Banking Revenues
Corporate investment banking revenues totaled $253 million, reflecting a 20% increase year-over-year, with advisory services revenues increasing by 38%.
Public Finance Business Growth
Municipal financing revenues grew by 27% year-over-year, outpacing the market issuance growth in par value of 15%.
Equity Brokerage Revenue Increase
Equity brokerage generated $54 million in revenues for the first quarter of 2025, up 10% year-over-year.
Fixed Income Revenue Growth
Fixed income revenues increased by 7% from the year-ago quarter driven by solid activity across most client verticals.
Increase in Managing Directors
The firm finished the quarter with 182 managing directors, a 6% increase from a year ago, highlighting expansion efforts.
Negative Updates
Challenged Corporate Financing Activity
Corporate financing revenues were down 32% from the year-ago period, with a weakened market environment for equity underwriting.
Anticipated Decline in Advisory Revenues
Second quarter advisory revenues are expected to decline from the first quarter levels due to heightened market volatility.
Uncertainty and Volatility
Heightened volatility in equity and debt markets and continued uncertainty are impacting client engagement and market activity.
Challenges in Consumer and Energy Sectors
Consumer goods, especially those sourced in China, and energy sectors are facing challenges due to market conditions.
Company Guidance
During the Piper Sandler Companies First Quarter 2025 Earnings Conference Call, management outlined several key metrics and provided guidance amidst a challenging market environment. The company reported adjusted net revenues of $383 million, a 17.9% operating margin, and an adjusted EPS of $4.09, all showing growth compared to the previous year. The corporate investment banking division saw a 20% year-over-year increase in revenues to $253 million, with advisory services contributing $217 million, a 38% rise from last year. Despite current market volatility, Piper Sandler remains optimistic due to its diversified sector coverage and product capabilities. However, they anticipate a slowdown in M&A deal cycles and a decline in second-quarter advisory revenues. The public finance segment reported $26 million in municipal financing revenues, a 27% increase year-over-year. The brokerage businesses also showed growth, with equity brokerage revenues up 10% and fixed income revenues up 7% from the previous year. The company finished the quarter with 182 managing directors, reflecting a 6% increase from last year, highlighting strategic hires and expansion into sectors like infrastructure and healthcare investment banking. Piper Sandler remains committed to driving shareholder returns, having repurchased 266,000 shares for $81 million and paid $70 million in dividends.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.