PHILADELPHIA, PA — Cohen & Company Inc. (NYSE American: COHN) has released its financial results for the second quarter ending June 30, 2024. The company reported a net loss of $2.3 million, or $1.47 per diluted share. This compares to a net income of $2.0 million, or $1.28 per diluted share, in the first quarter of 2024.
“We were pleased with the performance of our full-service boutique investment banking operation, Cohen & Company Capital Markets (“CCM”), which generated $6.4 million of advisory revenue and acted as lead bookrunner on two SPAC IPOs,” said Lester Brafman, CEO of Cohen & Company. “CCM has grown to 24 professionals, and we intend to continue to opportunistically add investment banking professionals to our CCM team. We are optimistic about CCM’s pipeline and look forward to consistent CCM production through the end of the year.”
Overall revenue for the quarter was $10.8 million, a decrease from $18.6 million in the previous quarter and $22.6 million in the same quarter last year. Key revenue figures included:
- Net trading revenue of $8.8 million, down $1.1 million from the prior quarter but up $1.4 million from the previous year.
- Asset management revenue of $2.1 million, down $0.6 million from the prior quarter but up $0.5 million from the previous year.
- New issue and advisory revenue of $6.5 million, down $17.9 million from the prior quarter but up $5.1 million from the previous year.
- Principal transactions and other revenue was a negative $6.6 million, compared to negative $18.4 million in the prior quarter and positive $12.2 million the previous year.
The decrease in the net loss from the prior quarter was attributed to ongoing unfavorable mark-to-market adjustments on the company’s principal investing portfolio. Brafman noted, “While our second quarter results were weakened by the impact of ongoing unfavorable mark-to-market adjustments on our principal investing portfolio, we are pleased to have improved the Company’s performance at the adjusted pre-tax loss line by $10.4 million year-to-date versus 2023.”
The company also declared a quarterly dividend of $0.25 per share, payable on September 5, 2024, to stockholders of record as of August 22, 2024.
Buy, Sell, or Hold?
Investors need to evaluate several factors when considering Cohen & Company as an investment. The company has shown growth in its capital markets division but has experienced volatility in its principal investment portfolio. The net trading and advisory revenues are promising, but the overall negative revenue from principal transactions raises concerns.
Given the mixed results, investors may consider holding the stock if they are already invested, as there are positive signs in the advisory and trading segments. However, potential investors might want to wait for more stable results before buying. Cohen & Company remains a speculative investment due to its fluctuating earnings and dependency on market conditions.
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