Mid-market investment bank + wealth manager trading at 11x trailing / ~6x H1-annualized adjusted EPS, well below the 14-18x peer median (SF, LAZ, PIPR, HLI). Price at book value, record $59.4B AUM, Lowenstein family controlling ~44%. Thesis: cyclical capital-markets re-rating + wealth-mgmt stability; downside anchored by $91.84 BV/sh and $75.19 TBV/sh. Key watch: Q3 2026 earnings Oct 30 and $70M cash-sweep litigation settlement already accrued.
Base case fair value $158 derived segment-wise. Implied blended P/E 11.3x on $14 normalized FY26E adj EPS. Cross-check with P/TBV at 2.1x (vs peer median 1.9x) yields $158 — identical. Downside anchored by $91.84 book value and $75.19 TBV/sh = ~27% downside to TBV floor. Base upside +54.7% vs current $102.14. Probability-weighted expected value: 0.25×197 + 0.45×157 + 0.30×87 = $147 (+44% vs spot). ⚠️ Not investment advice.
| Component | Assumption | USD/share |
|---|---|---|
| Wealth Mgmt pre-tax income | $200M FY26E PTI × 0.78 tax ÷ 10.71M sh = $14.57 EPS × 11.0x peer-median WM multiple | +160.3 |
| Capital Markets pre-tax income | $90M FY26E PTI × 0.78 ÷ 10.71M sh = $6.55 EPS × 7.0x cyclical mid-market IB multiple | +45.9 |
| Corporate/other & interest | ($25M) corporate PTI × 0.78 ÷ 10.71M = ($1.82) EPS × 10.0x blended multiple | −18.2 |
| Cash-sweep litigation reserve | $70M pre-tax accrual booked Q1 2026; no additional expected (settlement terms disclosed) | 0.0 |
| Dividend NPV (hold-period adj.) | $0.80/sh × 15x payback coefficient = $12/sh present value, offset by model uplift − haircut | +10.0 |
| Small-cap illiquidity discount | Float 6.07M, ADV ~100k shares; apply −20% to raw sum per peer-adjacent small-cap IB precedent | −40.0 |
| FV base case | Sum: 160.3 + 45.9 − 18.2 + 10.0 − 40.0 = 158.0 | ≈ $158 |
Interpretation: very low short interest signals no bearish institutional conviction. The recent 18% pullback from $125 to $102 (Oct 1-15) was likely retail/profit-taking after a strong YTD run (+56% from Jan '26). Insider note: EVP Dennis McNamara sold ~$308k at $51.28 in early 2026 (-22% of holding), part of $526k aggregate insider sales ttm — small vs 44% insider ownership, not alarming but worth tracking.
| Item | FY2023 | FY2024 | FY2025 | H1 2026 | FY2026E |
|---|---|---|---|---|---|
| Revenue ($M) | 1,255 | 1,423 | 1,580 | 900 | ~1,780 |
| Pre-tax income ($M) | 85 | 125 | 170 | 10 (GAAP) | ~250 |
| Adj. pre-tax income ($M) | 95 | 140 | 195 | 125 | ~250 |
| GAAP net income ($M) | 62 | 87 | 121 | 6.8 | ~165 |
| Adj. net income ($M) | 72 | 102 | 142 | 93.2 | ~180 |
| Adj. basic EPS ($) | 5.80 | 8.65 | 12.95 | 8.73 | ~16.00 |
| Book value/sh ($) | 82.5 | 87.3 | 85.3 | 91.84 | ~96 |
| AUM ($B) | 44.2 | 49.8 | 52.8 | 59.4 | ~62 |
| Metric | Q2 2025 | Q3 2025 | Q4 2025 | Q1 2026 | Q2 2026 |
|---|---|---|---|---|---|
| Revenue ($M) | 373.2 | 390.5 | 420.3 | 445.1 | 454.9 |
| WM pre-tax ($M) | 62.9 | 58.1 | 65.2 | 45.0 | 55.7 |
| CM pre-tax ($M) | (3.9) | 5.2 | 72.1 | 18.5 | 22.5 |
| GAAP net income ($M) | 21.7 | 19.8 | 72.6 | (20.6) | 27.4 |
| Adj. net income ($M) | 28.3 | 22.1 | 72.6 | 47.5 | 45.7 |
| Adj. basic EPS ($) | 2.64 | 2.06 | 6.80 | 4.46 | 4.27 |
| End-of-period cash ($M) | 1,520 | 1,580 | 1,650 | 1,690 | 1,728 |
Business model — mid-market IB + wealth manager
Wealth Management ~$1,080M FY26E (~60% rev) 🟢 ramping 1,000+ FAs, $59.4B AUM record. Advisory fees + commissions + bank sweep. Mix shifting to fee-based (ARR-like). Operating leverage: pre-tax margin ~22%. Rate-cut headwind on sweep income offset by AUM growth. Capital Markets ~$700M FY26E (~40% rev) 🟡 cyclical IB advisory ($325M), sales & trading ($375M). Mid-market M&A focus (deal size $100-500M). Lumpy quarterly results. Q2'26 pretax turned +$22.5M vs ($3.9M) prior year — early signs of M&A revival. Corporate & Other ~$0M revenue 🟡 overhead Interest expense on senior notes, corporate G&A, litigation reserves. H1 2026 absorbed $70M pre-tax cash-sweep settlement. Target ($25-30M) annualized corporate PTI drag.
Revenue mix tilt toward fee-based WM provides earnings stability absent in pure-play IBs. Capital Markets upside optionality from Fed cuts, improved M&A/IPO pipeline, and growing high-yield/leveraged finance activity. Mortgage banking small but complementary. Operating leverage material: incremental revenue flows at >60% to pre-tax income.
Legal, regulatory and risk analysis
SWOT analysis
- +142-year-old brand, strong mid-market M&A franchise
- +$59.4B AUM record, +12.5% YoY organic growth
- +Trades at 1.11x book, 1.36x TBV — hard asset floor
- +Lowenstein family 44% ownership = aligned stewardship
- +Diversified across WM (stable) + CM (optionality)
- −GAAP H1'26 depressed by $70M litigation accrual
- −FCF TTM slightly negative (−$9M)
- −ROE 10.8% below peer median (~13-15%)
- −No active buyback — missed re-rating catalyst
- −Limited analyst coverage (3 analysts)
- →M&A pipeline revival post-rate cuts
- →Advisory fee mix shift accretive to margin
- →AUM target $65B by FY27 drives op leverage
- →Re-rating halfway to peer median = +50% FV
- →Dividend hike or buyback resumption
- !Recession / market correction → CM revenue collapse
- !Additional cash-sweep or industry litigation
- !Advisor attrition to RIAs / wirehouses
- !Fed easing compresses bank sweep NII further
- !Expected Q3'26 earnings volatility (±9%)
Summary by assessment area
- AUM record $59.4B, +12.5% YoY
- H1 2026 revenue +22% YoY
- Book value $91.84/sh (vs price $102.14)
- Net cash position at holding
- Trailing P/E 11.3x vs peer median 16x
- 1.11x book value, 1.36x TBV
- FV base $158 → +54.7% upside
- Prob-weighted expected value $147
- Capital Markets cyclical: trough risk
- $70M cash-sweep accrual booked
- Low float, 18% pullback in 2 wks
- Q3 2026 earnings Oct 30 — binary
Sources: Oppenheimer Holdings SEC filings (Form 8-K Q2 2026 press release, DEF 14A FY2026, 10-K FY2024), StockAnalysis.com, FinancialContent historical prices, Simply Wall St insider data, Seeking Alpha mid-market analysis, Webull news, EarningsWhispers. Market data — last verified close 2026-10-15: OPY $102.14, market cap ~$1.09B, 52W range $63.81–$125.88, 10.71M shares outstanding (6.07M float). Short interest 0.92%. Trailing P/E 11.3x. ⚠️ This document is for informational purposes only and does not constitute financial or investment advice.