Piper Jaffray Cos. said its third-quarter profit declined, but the figure beat investor expectations and sent its shares sharply higher Wednesday.
The brokerage and financial firm reported net earnings of $5.3 million, or 33 cents per share, down from $19.7 million, or $1.11 per share, a year earlier. Revenue dropped about 2 percent to $128.3 million.
Adjusted for one-time costs and benefits, Piper Jaffray's earnings per share of 57 cents exceeded the 52 cents that was forecast by analysts. Revenue of $128.3 million also exceeded analysts' projections of $117.6 million.
The company's shares jumped 6.6 percent, closing up $2.25 at $36.19, and was the biggest gainer among Minnesota stocks in Wednesday's trading.
"The diversification in our mix of businesses contributed to our solid performance for the quarter," said CEO Andrew Duff. "Our equity-related businesses, led by equity capital raising and asset management, registered strong performance, and third-quarter M&A revenue surpassed the revenue generated in the first half of the year. In fixed income, we rebounded from a challenging second quarter, while the results in our public finance business reflected soft market conditions."
Asset management pretax operating income was up 20 percent from a year ago, while revenue rose 11 percent.
"The S&P index was up almost 5 percent for the quarter and 18 percent for the year, as funds flowed into equities have been positive for each quarter this year, reversing a two-year trend of outflows," Duff told analysts in a conference call. "As might be expected, our asset management business benefited from these market trends."
Capital markets pretax operating income was down 69 percent, while revenue was down 4 percent.