Piper Sandler beats estimates, declares $5 special dividend and stock split
Record fourth quarter revenue of $666.1 million drives 38% year-over-year growth and strong capital returns
Piper Sandler Companies reported record fourth quarter and full year 2025 results, handily beating analyst estimates and announcing substantial capital returns to shareholders, even as shares declined following the announcement.
The Minneapolis-based investment bank delivered fourth quarter adjusted earnings per share of $6.88, significantly surpassing consensus estimates of $4.74, according to Zacks. Revenue reached $666.1 million, exceeding analyst expectations and representing a 38% increase from the prior year.
Chairman and chief executive officer Chad Abraham highlighted the company's strong performance: "We had a fantastic finish to 2025, delivering record fourth quarter revenues. Full year revenues of $1.9 billion grew over 20% fueled by a record year from our advisory business, and strong growth across the rest of our businesses."
Advisory services proved the primary growth driver, with revenue surging 44% year-over-year to $402.6 million. The firm completed 127 advisory transactions during the quarter, a 38% increase compared with the same period in 2024, driven particularly by financial services work and a record quarter from the services and industrials team.
In a move reflecting confidence in the business, Piper Sandler's board declared a special cash dividend of $5.00 per share alongside a regular quarterly dividend of $0.70 per share. Additionally, the company announced a four-for-one forward stock split, effective at 4:30 p.m. Eastern Time on March 23, 2026, with split-adjusted trading commencing March 24.
Despite the strong earnings beat and shareholder-friendly announcements, Piper Sandler shares fell 3.7% to $331.63 in Thursday trading. The decline places the stock below its 50-day moving average of $351.27, though it remains above its 200-day average of $316.26.
Analysts maintain a positive outlook on the stock. According to Investing.com, Piper Sandler carries a consensus Buy rating with an average 12-month price target of $410.67, implying approximately 24% upside from current levels. The stock's year-to-date performance remains strong, having traded within a 52-week range of $201.54 to $380.26.
The stock split aims to improve liquidity and broaden the shareholder base, particularly relevant given Piper Sandler's high institutional ownership. As of January 2026, institutional investors held 94.19% of shares, according to Trendlyne. With shares trading at approximately 25 times trailing earnings, some investors may see the post-earnings pullback as an opportunity to establish positions at a more attractive valuation ahead of the March stock split.
Piper Sandler's 2025 performance demonstrates its ability to navigate challenging market conditions. Net revenues grew 24% year-over-year, while adjusted net income increased 39%. The combination of record advisory revenue and strength across capital markets and asset management segments positions the company for continued growth in 2026, assuming market conditions remain favorable for investment banking activity.