Evercore Inc. (EVR) reported strong financial results for the third quarter of 2024 on Monday, with both earnings and revenue surpassing analysts' expectations. However, the investment banking advisory firm's stock declined in pre-market trading, suggesting that investors may have anticipated even better performance or had concerns about the company's outlook amid macroeconomic uncertainties.
Evercore's advisory business remained robust during the quarter, with advisory fees climbing 27% year-over-year to $593.2 million. This growth was driven by an increase in revenue from large transactions and a higher number of advisory fees earned during the period. The company's underwriting fees also saw a substantial 43% increase to $44.1 million, reflecting its participation in more capital markets transactions.
The investment bank reported adjusted earnings per share of $2.04, surpassing analysts' consensus estimate of $1.96. Net revenues rose 28% year-over-year to $739.5 million, exceeding expectations of $713.3 million. Evercore's adjusted operating margin improved, expanding by 385 basis points to 18.2%, attributed to higher revenues and a lower adjusted compensation ratio of 66%, compared to 68% in the prior-year period.
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