Goldman Sachs Maintains a 'Buy' on Raymond James (RJF); Moving Past Auction Rate Issue at Acceptable Cost

Goldman Sachs maintains a 'Buy' on Raymond James (NYSE: RJF), PT $40.

Goldman analyst said, "RJF announced it has settled its outstanding auction rate securities issue, providing liquidity to clients on the remaining $280 mn of outstanding securities (down from $2.1 bn at peak). In F3Q11, RJF will book a $50 mn pre-tax charge to cover the differential between current trading value and par value (RJF will make clients whole) of the ARS, and will also incur a $1.75 mn fine to state regulators (not the SEC). We lower our F3Q11 EPS estimate to $0.31 (from $0.56) as we estimate the impact to be roughly $0.25. Our F2011 estimate moves to $2.20 from $2.47 and we retain our F2012/F2013 estimates and $40 price target."

For more ratings news on Raymond James click here and for the rating history of Raymond James click here.

Shares of Raymond James closed at $32.15 yesterday.

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