What a fantastic six months it’s been for Evercore. Shares of the company have skyrocketed 68.3%, hitting $337.32. This was partly due to its solid quarterly results, and the run-up might have investors contemplating their next move.
Is now still a good time to buy EVR? Or are investors being too optimistic? Find out in our full research report, it’s free.
Why Is Evercore a Good Business?
Founded in 1995 as a boutique advisory firm focused on independence and client trust, Evercore (NYSE: EVR) is an independent investment banking firm that provides strategic advisory, capital markets, and wealth management services to corporations, financial sponsors, and high-net-worth individuals.
1. Long-Term Revenue Growth Shows Momentum
A company’s long-term sales performance is one signal of its overall quality. Any business can put up a good quarter or two, but many enduring ones grow for years.
Thankfully, Evercore’s 10% annualized revenue growth over the last five years was decent. Its growth was slightly above the average financials company and shows its offerings resonate with customers.
2. TBVPS Growth Demonstrates Strong Asset Foundation
Tangible book value per share (TBVPS) is a crucial metric that measures the actual value of shareholders’ equity, stripping out goodwill and other intangible assets that may not be recoverable in a worst-case scenario.
Evercore’s TBVPS increased by 15.7% annually over the last five years, and although its annualized growth has recently decelerated to 8.2% over the last two years (from $33.79 to $39.54 per share), we still think its performance was decent.
3. Stellar ROE Showcases Lucrative Growth Opportunities
Return on equity (ROE) reveals the profit generated per dollar of shareholder equity, which represents a key source of bank funding. Banks maintaining elevated ROE levels tend to accelerate wealth creation for shareholders via earnings retention, buybacks, and distributions.
Over the last five years, Evercore has averaged an ROE of 33.9%, exceptional for a company operating in a sector where the average shakes out around 10% and those putting up 25%+ are greatly admired. This shows Evercore has a strong competitive moat.
Final Judgment
These are just a few reasons why Evercore ranks highly on our list, and after the recent rally, the stock trades at 24.3× forward P/E (or $337.32 per share). Is now a good time to buy? See for yourself in our full research report, it’s free.
Stocks We Like Even More Than Evercore
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