Canadian investment bank Canaccord Genuity Group (TSX:CF) has reported its strongest quarterly results ever due to a brisk business in mergers and acquisitions.
The largest independent investment dealer in Canada reported that its third quarter net income rose 87% from a year earlier to $61.8 million. Profit amounted to $0.58 a share.
Canaccord said companies have lots of capital, helped by low interest rates and rising equity markets, making it easier for them to spend money on strategic priorities. Advisory revenue in the quarter rose to a record $139.4 million, including $103.6 million from the U.S.
Canaccord’s stock soared as much as 8% to $16.43 in Toronto trading, the biggest intraday gain since November 2020. Shares of the company have now risen 42% this year, topping the 24% gain of the Toronto Stock Exchange.
Total revenue for Canaccord Genuity’s global capital-markets businesses rose 26% in the third quarter to $304.9 million, with the gains in advisory fees making up for lower client trading activity and reduced issuer activity.
Revenue in the global wealth-management business climbed 14% to $166.2 million, driven by gains in all three major segments of North America, the United Kingdom and Australia. Canaccord had $1.73 billion in cash on its balance sheet at the end of the quarter, up 91% from a year earlier.
Canaccord said it will use its extra capital to buy back stock, bolster its wealth business in Canada and the United Kingdom, and further strengthen its merger-and-acquisition business.
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