Jefferies to Benefit From Increased Investment Banking Momentum, Oppenheimer Says

05:16 PM EDT, 09/17/2026 (MT Newswires) -- Jefferies Financial (JEF) is poised to benefit from increased investment banking momentum in the third quarter, Oppenheimer said Thursday. The brokerage raised Jefferies' investment banking outlook to $1.274 billion from $1.059 billion, driven by merger and acquisition and equity underwriting. That pushed Oppenheimer's third-quarter earnings-per-share estimate for Jefferies to $1.06 from $0.67. Five analysts polled by FactSet expect $1 on a GAAP basis. The investment banking and capital markets firm is scheduled to report latest financials on Sept. 28. Jefferies' shares closed 1.1% higher on Thursday, but have fallen nearly 23% this year. JPMorgan Chase (JPM), Morgan Stanley (MS), Goldman Sachs (GS), Bank of America (BAC), Citigroup (C) and Wells Fargo (WFC) all posted strong second-quarter results in July amid trading and investment banking fee gains. Oppenheimer is generally cautious on the large-cap investment banks because their earnings beats have been driven by market trading, rather than a recovery in advisory and corporate deal-making, analysts Chris Kotowski and John Coffey said. Jefferies has derived 58% of its capital markets revenue from investment banking year-to-date, compared with 22% at Goldman, according to the Oppenheimer note. "We still believe in the likelihood of an M&A revival, and think (Jefferies) is exceptionally well positioned to benefit," Kotowski and Coffey wrote. The company's "forward earnings are particularly tied to a sponsor-driven M&A rebound and not so dependent on sustained robust trading activity." Oppenheimer has an outperform rating on Jefferies' stock.