Oppenheimer Sees Another Strong Qtr for Jefferies Group (JEF)

Oppenheimer analyst Chris Kotowski reiterated an Outperform rating and $40.00 price target on Jefferies Group (NYSE: JEF) after previewing Q3, which they expected to be another strong quarter despite their view that investment banking and trading will normalize.

The analyst commented, "It is only reasonable to expect and model that investment banking and trading will normalize to the pre-pandemic levels, and that is what we've been doing for all the investment banks that we follow. The Fed's balance sheet is 2x what it was prepandemic, and so maybe it won't happen, but still we've been building in a lot of normalization into our models. It certainly, however, did not happen in JEF's fiscal 3Q21E (June/July/August), and so we are bumping our 3Q21E EPS (which we expect to be reported ~9/30) from $0.60/share to $1.02. However, like with the other investment banks, we are still factoring considerable normalization in 2022E, and thus leaving estimates for that year as well as near-term price targets largely unchanged."

For an analyst ratings summary and ratings history on Jefferies Group click here. For more ratings news on Jefferies Group click here.

Shares of Jefferies Group closed at $37.29 yesterday.

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