Market capitalization: $3.5 billion
Write-offs since 2005: 0%
Debt to capital ratio: 11%
We weren't sure we'd be able to find an investment bank for our list, but the fact that Raymond James was the only brokerage that made it through our screens is a testament to how unusual the company is.
Raymond James, based in St. Petersburg, Fla. is one of the few remaining regional brokerages in the United States. The company also owns a commercial bank, and its conservative lending approach helped them through the mortgage crisis, as they had virtually no subprime exposure. And their large network of independent financial advisors has brought the company success, so they haven't been compelled to move into riskier parts of the market.
"Raymond James is a good buy," said South Street Advisors chief investment officer Tom Carhart, who runs a mutual fund that holds a large stake in the company. "The company is well positioned to continue to outperform the industry."
The stock was punished earlier this year after reporting estimates that missed by 19% in the fiscal first quarter, which ended in Dec. 2007. But after beating analysts' estimates by the same amount in its fiscal second quarter, the stock rebounded by jumping nearly 20% in one day.
And though the stock, trading at nearly 15 times fiscal 2008 earnings estimates, may seem a bit pricey when compared to other larger investment banks, the stock may have room to grow. It may deserve a premium because of the lower risk. Plus, Raymond James still hasn't climbed back to the price at which it was trading before it missed forecasts in the first quarter. More galleries