Jefferies earnings results beat Wall Street expectations

Jefferies Group Inc. swung to a first-quarter profit, beating Wall Street expectations, as the middle-market investment bank reported strong trading revenue growth.

Its shares rose almost 15 percent in morning trading.

Jefferies on Tuesday said it earned $38.3 million, or 19 cents per share, for the three months ended March 31 versus a loss of $60.5 million, or 45 cents per share, a year ago.

Analysts surveyed by Thomson Reuters had forecast a loss of 8 cents per share, on average, in the latest quarter.

Revenue jumped 56 percent to $347.3 million from $222.1 million. Analysts had forecast revenue of $287.5 million in the latest quarter.

Jefferies’ trading business lifted the company’s results, as revenue from principal transactions rose to $152.3 million in the latest quarter from just $54,000 in last year’s first quarter. Last quarter’s figure marked an even sharper turnaround from last year’s fourth quarter, when Jefferies posted negative revenue of $56.5 million from principal transactions.

Much of the latest quarter’s gain came from Jefferies’ surging fixed-income and commodities business, which booked $203.3 million in revenue, up from $40.3 million in the year-ago quarter.

Last quarter’s gain in principal transactions revenue offset a 10 percent decline in commissions revenue to $101.9 million from $113.7 million.

Jefferies’ investment banking revenue shrank by nearly 63 percent to $37.1 million from $99.2 million in last year’s first quarter.

Shares of Jefferies rose $2.13, or 14.9 percent, to $16.43 in morning trading. The stock has traded in a 52-week range of $7.97 to $29.00.