Cowen (COWN) 28 Jul 202020 Q2 Earnings call transcript

Good morning, and thank you for joining us to discuss Cowen’s results for the Second Quarter of 2020. By now, you should have received a copy of the earnings release, which can be accessed at investor.cowen.com.

Before we begin, the Company has asked me to remind you that some of the comments made on today’s call and some of the responses to your questions may contain forward-looking statements. These statements are subject to the risks and uncertainties described in the Company’s earnings release and other filings with the SEC. Cowen has no obligation to update the information presented on today’s call. our Company reference information believes call, measures, non-GAAP for today’s the which will on speakers certain will financial investors. Also provide useful the in those reconciliation of measures GAAP consistent Reconciliation to as earnings today’s with presented release. is Company’s

the Now, over Jeffrey Chief Officer. to and call I Chairman to Cowen’s Mr. like Executive would turn Solomon,

today earnings is Jeff Lasota. Solomon you, morning welcome and CFO, This Thank call to Cowen our joining call. me on operator. Good second our is quarter XXXX and Steve

quarterly adapted available and cases unprecedented We've ago, be section with pandemic public have vaccine evolving are quarter. like make for Cowen measures development your are release. to supplement pandemic. you results for a deal past for due that and and COVID-XX the seen Steve economic the XXXX. in which We from The are mortality. we we on the optimism particular us patients you stringent we and pace, spoke Relations reminder, lot over, reduce data great a I gives there how treatments That in progress challenges progressed will in everyday at it a second to questions. earnings financial COVID. better the place of three is for that will Investor both of in the better the clearer less uncertainty. the where few will on than with cause stand of encourage in is we XXXX we months the to months would how As concern. stock we we happy we an This health at still vaccines And to finish to that, of has morning, our out treat to cause website. the areas a after resurgence far review little said, our take financial outlook to than answer in the when Overall, after have And to review conjunction tumble Then

a reopen, Winter. While as returning cautious a streets as as prioritize Cowen, expected into Fall our and coordinated we that are we about certainly lack results are rise well-being And teams we office remain quite concerned infections of national the to response quarterly At we about safety our the in it operating the and head to their clear the continue efficiently. and from of is families. we we

some office to of place so. As we choose time remote, -- with with continued lie returning to navigate help to such, or challenges and safety the our teams clients majority the measures appropriate work office in the the that to staff our ready in Whether ahead. do remotely to stand they if

well find a at drug difficulty] and facing and as as necessary therapies compressed capital to and on forefront to rely the formation. science on focused capital and diagnostics, the those healthcare vaccines to talent new access tools us solutions puts discovery, of Our digital timeframe. Company’s in [technical find

environment also are too. with unfolds, we social race are intent, are are to national listening of As more of economics members. difficulty] actively and and [technical conversations trying Cowen the they our so a the we pandemic to issues all only create the equity conversation, of team inclusive Not for

is they That Head and inclusion Rashid our the also at industry. the someone though a we Cowen's began combination diversity earnest process. achieve all for a the us she recent that our allowing Ripa inclusion enable how will journey. ourselves. diversity us path more highlighted herself month In months diverse deliberate Earlier inclusion well. as our inclusion six with intent processes to and achieve establishing Diversity, Even a first have them. Inclusion just of search clients outcomes of continue and is towards she in few who for experience as view few delivering racial expertise to Cowen far has if month, in hired our weeks, increased leader are one achieve go holding in only those all better Fostering events, strong are another as equity business partner prior we established to to have on to that and stakeholders requires with for with imperatives accountable past Ripa and on not and this outcomes Our moral can imperatives, to in order in workplace. real for and well views the

us. of together more we're [technical diverse ahead community. we challenges have a excited as difficulty] We But build

protests having the pandemic, election significant that and XXXX. maintain polarized doing aware uncertainty, help to our remain our must to world, and memory, We by the recent serve we the So stability with to remainder in as in our for approach are Presidential in at Cowen. working of even uncertainty success most the are we clients Indeed, well continue the outperform. we're and the the of But this we mission clients. place the even humbled our face pretty be of they that

outstanding than our had quarter March even gains factoring revenue for While the month period setting a challenging substantial the we before records decade, Nikola Corporation. investment from for of second Cowen, most VectoIQ in results more the profitability, new was and in in the and

strategies market And hours Cowen. at the life determination Even diagnostics, share M&A seven team years XXXX perspective, and in and results? behind high For XXXX activity markets quarter What's and our gains Cowen tools the in surge than of quarter all of XXXX these operating performance in else, value economic full the Investment in of continued all rebound our greater combined. second hard combined. assignments, sciences brokerage of Management. in above income a and countless across operating healthcare by here a work of and investment Well, greater capital income the in Nikola, quarters our our was previous the excluding for than total was

closer Let's at our take performed. how operating divisions look a

off, truck last which maker electric was a which First Corporation acquired in stake our the made investment we Nikola in stock, Nikola, small VectoIQ month.

unrealized investment were that over quarter were and $XXX million. total our to million banking $XX gains deal the Our just fees for related under

While to are because we're a is stake franchise, well and do so, we to of when Nikola it results as sustainability. intend the of able strong win our we as knowledge our our monetize impact and highlighting growing stake the this in domain demonstration

want don't gains were operating the the overshadow results of own incredibly which to We right. also in their businesses, strong the Nikola records

Markets the VectoIQ represented private pipes includes in made from quarter. banking, XX fee second markets, debt financings we IPOs, Capital quarter. gains ever surged, transactions the placements, advisory fees in results, revenues of Sector Nikola In the standout transactions managed quarter. approximately investment including and total saw record first we during we the Healthcare those revenues, highest revenue. XX accounting volatile for and board. [XX%] across debt banking XX% another during we were Advisory banking for performance with the market which in single Building M&A revenues. two banking strong including banking Markets the activity XX% on investment for XX% quarter. of of of As businesses the our acquisition. while was private our Combined for quarter revenues Capital had

XX% added It We've as asset cross travel, finance excellent number included Our and a also The rebounded In record all to non-U.S. per million the our continued quality difficult quarter in collaborative research in of with we research, quarter with last trading, Securities, hires prior daily the including set of average of well to out in day. in quarter. trading remains $X.XX for environment even the after situations momentum year published revenues With trading. options, stake high talent. total XX% high European and prime were hire trademark we almost increasing first as breaking swaps, the portfolio electronic reports of cash trading, $X.X pieces. Highlights at and brokerage see opportunity an execution research street more million senior leadership in cash capabilities and levels. put growth day, trading. to grew also brokerage, remains per our Cowen less grew. an engagement special reports in trading client read prime thematic book, versus our trading,

hosting of non-deal number of sever held major we In engagement, significant and seven well. shows companies conferences, of thousands a as client hundreds virtual road terms instead of clients of

source. We In division, in also fees a our conference income calls nearly client productivity run management participants. gains increase accruals, XXX annual highest share incredible This hosted management for XX,XXX investment market yield record over clients, at institutional while years. remained in the rate percentage incentive four had we double-digit yielding in and

during interest investor in assets strategy five ended portfolio and surge IPOs strategy quarter. That healthcare in sector in a quarter the Our benefited under the the $XXX of companies million from from management. biotech with

had Our assets sustainability $XXX in strategy end. million quarter management under at

the eco-ATM outperform end quarter portfolio Merger phone the first AuM after volatile quarter. strong first mobile in $XXX investment, despite for The be Arb strategy million to of a merger from fund months. past economic HFRX at the The arbitrage several Index. rebound shock resilient the The has the recycling had proven benchmark

AuM strongly the close and prior fund the the committed. ended And is quarter performed the in up billion and second four our activist billion strategy $X.X Royalty fully billion quarter it in HealthCare is and fund Russell assets quarter, Our in strategy index. outperforming the XXXX three total benchmark with $X.X finally, strategy with year-to-date in from committed $X.X quarter. is XX% well This HCR

Turning to our asset company.

declined to company review with to company in is over for LP real of in of by assessed $XX.X the to environment, $X.X time not remaining more Surfside segment we to this valuation marked asset firm our our million results although of lender million. value We wrote-down current which the to third-party value recover monetize. The million that the reminder, The investments each investment. a in demand us will potentially of the information by Steve and investments, the non-core up giving I dollars million a $X.X wireless its which some now do for $X investment. Steve. net the to we $XX.X financial was expect our experienced intend quarter. Linkem, includes brief increased renewed Eclipse services. the quarter stake for interest turn million Lasota continue And We in restructure work property As a call the Italian estate as the to by

Jeff. Thanks,

up share a record of For to $X.XX share GAAP of million. GAAP $XXX.X million reported versus $XXX.X XXXX, GAAP the to income net common or of year-over-year from per $X.XX million or attributable We net income revenue per second quarter $X.X million compensation was the $XXX.X increase XX% the million and D&A were $XXX.X million expenses period. benefits compensation In in an D&A prior quarter the is excluding prior from GAAP second year quarter, million, period. expense second and $XXX.X XXXX, $XXX $X.X GAAP the were year million. expenses for of of stockholders

an of year operating, period. administrative Second was were million income million million $XX prior prior other in quarter the to and that million increase expense year period. from compared $X the And of second general tax million expenses $X.X $XX.X quarter $XXX

non-GAAP impact difficult costs as in how operating which uses the intangible operating the and expenses. information how these additional may to Now turning divisions, adjustments Economic consolidation release believes and consolidated company filings we pre-tax goodwill transaction investors measure provides certain to of core is The quarterly is our income In associated and includes economic measures depreciation other a financial earnings which filings certain economic income. performance income in impairment company Company's and for before about eliminates businesses the transparency excludes reclassifications, to with debt. measure of economic our pinpoint, non-GAAP the in amortization related these reorganization find that otherwise general, be the which and income our of a additional and useful. similar measures, measures refer but have expenses management

arrive are providing three showing and earnings quarterly reconciliation now economic our made a categories to We GAAP of adjustments the that release to income.

have do income. The effect on first and reclassifications two economic management fund not any consolidation reclassifications categories

non-GAAP full from share the of category adjustments or does We statement of the financial current $X.XX in of most taxes, economic measures. impact my the XX-Q.The these explanation available earnings income are exclusion in third of remarks to for reported million coming economic per the quarter. $XXX.X be based operating these adjustments will The our impact with income release income on remainder

had of of Jeff we income Looking record overall million, the the at as Op $XXX.X noted, and business Co income in quarter company second segments, in of had million our $XXX.X $XXX and of operating million revenues a quarter economic segment. total XXXX. operating economic

$X.X of second $XX.X of to prior revenues $X.X a economic XXX% compared increased operating in On million an reported economic in the the economic an of income million. basis, Asset $XXX.X million year-over-year million income for loss Revenues quarter year of Co and $XXX.X overall the had loss million in XXXX quarter. period. second we of to

period. investment quarter for year $XX.X record prior second was for were of the versus income in for $X.X up quarter of million to was quarter XX% million income year-over-year in up the $XX.X quarter the Instead record Management the was million brokerage was as $XXX.X quarter year-over-year a to $XX.X prior of investment loss million the of $X.X versus the $XXX.X best $XXX.X income the in quarter XXXX. in For well million period. million to The million. a second on the year XX% record. a quarter revenue compared banking million fees It revenues

an Nikola we includes our $XXX.X the our financial underwriting quarter transparency additional provide revenues Capital with now unrealized of Banking revenues. Markets first Advisory out Consistent Investment revenues by and income investment to quarter Capital investment. gain million supplement, into our into Markets our breaking related in Second revenues

to compared $XXX.X to Turning million benefit in and expenses, $XXX.X quarter the our year prior was expense period. compensation million for the now

to comp-to-revenue of year-over-year income economic revenue. XX.X% from ratio Our XX.X% declined

is year-to-date. comp-to-revenue Our ratio XX%

XX% trade were We due the the other higher second in relation the occupancy Fixed investment equipment million to compared was lower In quarter, we in million are ratio to of compensation XXXX of prior to decrease totaled to by remainder increase the on $XX.X the offset $XX.X although expenses period. gains expenses and part the million business a from targeting in quarter year second in to expenses. down travel, accrued XXXX, partially will quarter-to-quarter and of costs Variable in expense XX%. $XX.X Nikola annual during the at non-comp of and execution could The quarter XXXX, the due the decreased $XX.X second non-comp expenses. million of it fluctuate brokerage and second year. in rate unrealized from comp-to-revenue entertainment quarter development volumes and of XX%,

were the quarter Second million in quarter of million XXXX. depreciation to amortization compared second expenses and $X $X.X

the balance Op invested quarter had in million. $XXX.X includes company the invested million Co Company in that capital totaling totaling regulatory at We Turning capital had $XXX.X sheet, broker end, to asset capital. million dealer $XXX.X in

XXXX. of this per ‘XX. deferred million of first of second which Tangible rose equity, compared value million to XX% end of up went million from was quarter equity in book equity the second XX, was end, $XX.XX the share, value our asset XXXX. from in is Turning XX.X% XX% as XXXX. equity stockholders $XX.XX December XX, $XX.XX $XX.X at XXXX $XX.XX total on from share quarter $XXX.X to as half million book of December The divided the year. XXXX, quarter the of up common plus common XX Return in common at $XX tax which almost per Common preferred equity, is compared as was by to to June $XXX.X of equity outstanding shares to

the impact of was on annual XXXX equity XX% Nikola the second of long-term well of common above quarter ROCE. Excluding in target [indiscernible] our return

As our in we maintained cash dividend of share. morning, per $X.XX release noted our common Board the this Directors of quarterly

During the shares repurchased $X.X for we XXX,XXX second million. quarter

Jeff. flow weighing purchase open to that, on of the the well market opt and For call the as available conditions. market on turn over to an our basis, prevailing I'll we XXXX, the remainder additional buybacks of opportunistic business shares back in may as impact With cash

Thanks, Steve.

Cowen. a up of I'd rest questions, how you to for of we like Before is XXXX sense take your shaping give the

in COVID the then be pipeline a years. November. to trading out levels market the July ahead have very In we’d uncertainty Overall, As around started of second as slowdown the would the Daily many effective we a We a monthly solid the case the in for business has That election. of the in treatments volumes seasonal pandemic not Banking questions as surprised noted a position note. quarter the develop businesses in to election of and and we of said, Markets progression have There's the August also to Average we previous see deal lot of July slow to vaccines. third strong average well year-end, and of on competitive robust the there quarter. Investment of second great par are with are efforts but revenues activity had ahead in also a for the a are earlier, I revenues U.S. on in running been quarter. surrounding new pace expect and Capital

Nikola we noted, income about our mark weigh investment the Nikola required the as since are our our Steve by in and down third is could June, to quarter close XX. position -- half As on this down

to important financial Cowen years and environment, hard that day I it XXXX and communities. and team. that, quarter will of the we team with we recommit So is working work With had. recognize help that is second ever a Operator. to equally up open up has remain important our as of questions. our to our clients the every but humble and strongest for results sum also hard our of aware it ourselves we this that And It by successes, planning, positioning combination our

Certainly. [Operator Instructions].

Wolfe Research. question the first of Chubak line Our from comes Steven from

question please. Your

Hi, good morning,

Steve. Hi,

morning. Good

Hi.

I the quarter activity relatively sustained sustainable some in to could So pickup strengthen non-U.S. improvements activity the is given Jeff, you potentially appreciate we some nascent rate businesses and business regarding appear platform maybe are feels commentary factors derivatives speak year really last hoping to especially driven have brokerage believe some it start to of activity, some are what the the of a recent to in strong the stages trading of saw July. for these could you the some of on momentum continuing. off relative was growth and that brokerage still what Cowen run that drive like that

Yes, cross-sell of difference. and and services of do better. we mean, a the our always I hit can I number clients, can on we been help made has bear a products philosophy few to think a Certainly, bring our anyone things of that you've have to for that them

of fact that's all electronic And that's prime platform that's or that's business with sales, new the affiliated pool. and touch I capability. trading, think, around trading preeminent wrapped sometimes the trading low and sometimes brokers our the trading sort sometimes and have, research obviously, our not on options European outsourced that independent any dark we That's street

you is I share that look an describing I've up Can And of sure of those strategic at are that hi, that it try when this our our as firm, a for and of the through hear happening really certainly So what together businesses who just side and and of pandemic our a relationships guys you way we allowing and have, collection making volatility clients they you of think your wallet make lot appropriate me? of market special a there. really set and people -- is sort product best we're buy result us. to divide that increasing picking the of the that size. It want I of of and what's a also to figure is been their introducing out as maker what's get relationships to we our to is would sure say difference choosing and a a the lot take itself they which work capabilities organization. from for is and the relationships, what's clients

you. I Now hear can

Sorry. phone Yes, I my out. think cut

Sorry about that.

divide? of side we being are increasingly, difference that think the certainly a I making terms of big on right So in

mark-to-market this maybe and -- to question the obviously want regarding recognizing large timing next this gains, Got like portfolio the pushed year. significant just these volatility considerations it. potential with you as parameters going monetization of regarding as well quarter-to-quarter, me might get gains of get from some of And the large from that monetizing the to Nikola plans quickly may updated prevent there's a be some year marks just and a those sense like provided one as that some into of those gain out just to

to we investors as Well, certainly I the subject our sponsor are shares. case lock-up, in Nikola of most in situation, a of the mean,

I for within is would it -- we think so, one, out do get the that's we not on And we six earliest can months, sure. day that

the to opportunity to we we would we that company very not we a sure levels I'm we these doesn't how make position. position stock a I six the continues year. But But, the be monetize the are being we're have disruptive. exit think certainly other these year I should that if levels, the with want comfortable within position about closely beginning trade and within at be be that working to careful it and that months. the that a to think in sometime monetize stock If at year starting beyond in to trade reasonably sponsors that

other we we been of mean, investments, better. investments Linkem a I gotten private lot has certainly business the the look the And are think at that the that's For for same I great. path along have, continuing some

guidance And a Capital made that And move Information at Fund, towards e-commerce so given where in in you company it and XXXX certainly, Aid think totally those timeline. it I position a then the towards. can up people see would the Certainly, a But, of our similar look if is we've a how [wish.com]. that the helps we're on progresses. largely timeline Markets We'll be conversations. access which that puts having we're position the

an in well the the platform plays a with like spending you how probably time, say push towards store and be at be e-commerce so will -- Board that company a that certainly effectively is looking judicious an and wish.com. more will. online I for if that economic to people a very across And and $X And their would

has quarter. actually some it, of seen improved we've So the of shared over course numbers to business those past they've the the extent

to that point So certain company in at take they've XXXX. I they're looking public that publicly said think

to on that either three don't So is that to timing track relating there, just caution of the the we've months. the that two or I same I would we're those everybody of things over though, the you still seen we've relate as control positions. heard past think We course to

Thanks. comp the had in Jeff commensurate the just one with And reasonable Nikola on the guess, XX% coming expected with around final in one expect accrual bigger just just picture. to gain some regarding you quarter. some the to me, of it comp accrual the that reversal for so philosophy gain that XQ reverse comp, Is of that, and I

Now, against I given how a portfolio comp to was typically around speak your could hoping going less philosophy margin or you're that you compensable maybe gains is revenue future viewed source? to higher this as

excuse your to answer we reversing against comp accruals comp yes, be will we is way the it. accrued against So same the first question, me

as do we counter reverse So come because things the Nikola look each we we a year-end, quarter but, each this that we're the level. take comp-to-revenue think at philosophy to are Certainly, I look sort look is, how numbers. overall year. head will we'll of of ratio into over obviously extent we And progressing for we as I we overall think the doing comp we the accrual own investment XX% And around XX% reflects that the total its expectation the here is trade I of how quarter we signaling to course stands around the less would at on think XX% at at that ratio. we but revenue rest that see accrue the income -- still continues And to we're this targeting will a target.

much taking questions. That’s great. for so my Jeff, Steve, thanks

Steve. you, Thank

you. Thank

of next Michael Our of KBW. the comes line from Brown question

please. question Your

Jeff you and are Thank you, good guys? how operator. hi, morning. Yes, Steve,

morning. Good

are Good. you? How

I'm wanted to stick with Nikola to start. Good. the

and some term freed of are like gets longer color of of bolster information increasing that Thanks. is some that the you look acquisitions kind would return up, I and you and the capital past buybacks, Linkem and be talked also and in exit that to most you other into also deploy franchise any where plan appreciated? your Nikola if is, your the so, as cash think So guess about capital for kind what looking do I investments the you to [indiscernible]

a it's And I question, they great don't we before think, our count So chickens hatch. Mike.

we'll if at the book we see the understand as how monetize that play value. us in we stock to is continues a of world it book Obviously, be we some the to trade making at than discount state accretive based to the So and shareholders return value capital to decisions as it. on economy cheaper for

in way, because it turns the the depend we we wouldn't for more will. are I that the an that So size opportunity or if why will us these we do that, of own that that. we what what when do love to really headed. we've where And on love there’s we buy amount monetized do that of still and another will specifics overtime we and it we just world I think can't speak shown is of out the to if

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the when as competitors maturity. marketplace to our near-term and and lot questions or capitalized think whether no smaller base would long-term that of was we well equity that's there I a fact of in function with about are for there some be the not significant and have a real a was that question debt we around a never they Cowen that

in how think rapid a that we if puts judicious be want So fashion. sure to to that make that in way we things harm's because just we turn we're as capital return against will anything about us not us doing

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it environment. know does don't the we shape good it's like will a second up. ultimately saying basically, But half So pretty how sound

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investments stakes, think small bonds, there's of some -- in own number -- we or a I shares. that's

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on your on So, do at trend the about just or wanted need little of franchise do you a is trends to you the the hear feel in side a side it's bit that persistence you see trading you continue? though whether kind all invest more at lot of this any banking riff all? as having to to And

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X expect the probably over is size, think $XX in four grown to The three three past, for market aggregate me to market billion. of around -- I its to today estimate it's would SPAC years. we continue the the SPAC grow, grown probably it's I terms

relatively the market. rest the small still to compared it's So of

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something ways us known up sense to end as we're a that while because the many in practice this a the this in leading wake great have see to of and But continue it's is it we've day, So things doing, to this the for process. makes the a at to for we market do area. real

we're feel about so is think this good end -- close trade. And And nowhere it. very the we of that to we

taking Great, the thank for you questions.

you. Thank

next Sumeet of comes Sandler. line question Our the Mody from from Piper

Your question please.

in biotech on year, the little don't morning, perspective guys. some drill between the the year. see Thanks, the good election vaccine activity get you're around kind if Jeff see the wanted other outlook get your levels on for macro and uncertainty and to kind I a early this the sustainability relationship the you of the color and of the the of with a Do activity even kind just till appreciate more next year of for color remainder activity think we pandemic some of we of maybe could the elevated seeing factors?

anyone know. ball says I -- they in are well, maybe exactly I we're said, have have. doesn't they clear have things I They a think that's clear. or would a more bit think as little mean as a -- who thought just crystal you I we says know I would are a -- why that's

our to activity we call, On call, quarter told I'm did activity have that would started the first April of we between could quarter and see not sure when the up picking amount July. occur I first you

And financing the is as so of in pleasantly for we we think that world so Sumeet and financing I surprised all and industries are become the I best us positioned this of banks has talked Cowen ourselves a conversation we've very incredibly serve. one the think for strategic well and before

thing is. to like. clients that a And that market think giving to right wherever so of around the capitalized we're advantage are uncertainty withstand position of volatility our is volatility side and think that I well sure only get And other this to and think the to is are looks certainly, whatever advice to continue are at kind better making the the enough to do if it's I there's particularly the be uncertainty are taking those advice the the a going that I in much in that look the or for company and vaccine market, they election, to

industry the industry certainly amazing private and discovery, and in to industry be know to I All mankind capital and be. discovery it. never happy when we know enough problem a when vaccine. energy its we're to our lot a case the drug is be I history going of been our and will don't role. center, access that singular there at to So, at smart mind more -- and And I'm medical to in this will on the not is I'm shots know more the a it playing be goal there of there's is that this back vaccine capital, foundation is puts the to about think base this is that solve

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getting capitalized so a in a idea. can yourself where be well good is And you position

more kind timing doesn't trading kind as mark. approved assuming of kind early liquidation maybe kind around approve have enough. then the second fair stock, that on December Thank quarter monetization. do them? to fundamentals attractive you. of window the of Okay, open wait of of some one The a stock exit And Nikola, mentioned this in follow-up it’s below just by point does you for room the what guys Is the but priority you or

swings I as profitability. think at it's capital job -- allocators to our is quarterly look not and

that we're take where Our end the is to or of shareholders. then capital always capital and looking smart given that a would capital our as what view themselves. And that the make return job deploy background recycle where other there's capital. manager, -- on of and gains present and and where trading to that on We’ll And portfolio number trading depends I'm making think, and the a uses with stock factors determinations think investments day, stock, I to my they that redeploy also obviously, how the the the capital. to capital we that are but the allocation when is weigh capital as at those we best that on at for ultimately, really into places

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my All right, it. questions. Got for thanks taking

Okay

Thank you.

Devin of line the JMP from comes from question Securities. Ryan next Our

Your question please.

Jeff, How morning, Steve. guys? Good Great. are you

Good are how Devin, you?

Doing to dig some bit here we've have been want that more the a of just little in great. asked, been Most things through. but on going

of So in quarter what third raising Also uncertainty appreciate you starting great quarter few a there's can capital here a the the strong months a lot we clearly. difference as see makes And noted. backdrop.

lead of look to for are get So make and to about any roles, to run are firms per in or evidence, quarter a business you higher I guys kind of what where percentage economics it it more kind but of the capital crystal rising and obviously maybe of well, is more book a because I that or give that. transaction that's or momentum kind ball very your percentage can there validate little this any tough, flavor of time at that larger around raising was important did of think us managed you the seems when questions sense, gives view a wanted guess just but around more doing kind data internally most And you the like Cowen because getting roles right? just also perspective think

demonstrated franchise. of banks good have lead than be we Well, than we doing want I on to if time of a in in there. and so to of more some lead most our in in less books that recognize of just we long more and other are the are think status do I regardless reflects we been clients as think Certainly, when many can certainly business banks not we better have stature that our less we size healthcare, deals that instances we the that

we're of clients And syndicate. But And regardless the in on the that in maximize our -- a deliver ourselves so our economics choosy. more the with have, where to end maximize no we partnership our focusing our question bandwidth our are being the job for we there's is opportunities we're of we're where clients. at where with we day can putting our and position that

a for persistent as think goal this we capital. is said I and raise this player over Our in companies to Devin they be

have. for that's think first rewarded So of a being conversations. us then persistence you're I or consistently so to of this on us a and but we between for to the model, coverage client what's We've XXX. that deals made in extending makes for developing delivering us consistency past it's we're you're time deals done deliver that. a part between certainly adequately the think And in into then at cover. that seeing central things really few clients strategic you're about what that in for successful. function of relationships And enables much in for more done outset, in counts been a more And the quarter our get debt We've on deliver like deals always is healthcare and doing that we're that servicing them the the go our that's the franchise in clients M&A organization some seeing fact I our the to also of quarter, healthcare clients. the able

really strategic Cowen, finance I forward, at going quality and equities to IPOs those all advice along about business think, we how our can ability you is those many relationships and so we're knowledge think great well we help pipeline extend builds to a and model future our them base to as do and to their it's that journey. follow-ons that it about so relationships provide relationships, about And the not happy just as as it's because of can, of

many now less more IPO you on will left a And if little little bit dependence in instances seeing and so bit a we're is in diversification. being what lead

the If you you see gives supplement, there the it average at four details many QX. of look page the you and Devin, if And transactions significant in look in of -- on can how increase transaction our value some behind

perspective because that's differential important or areas you and maybe your so in is have of other and strategic recently a kind part of momentum around whether it very clearly love transactions larger the franchise you've for transactions, you're expecting maybe across a Fisker the or M&A nice more some what business the And of momentum seeing a M&A of what deals maybe and M&A and became so little on any Gilead to different some Steve. advice, and kind some in smaller flavor amongst there types Thanks, near-term? franchise get and to been you're the the Yes. of so seeing on your what business just [indiscernible] some historical focus you're and

is our there -- So increased. mean, I has median -- that I certainly you I see mean,

[indiscernible] of up last it people fee in taking M&A past If you'll larger see course the business that increased even better we've corporate grow over and the our I the something you year. to expect continuing supplemental know -- with you that's from four the been has didn't well median information, first look the think the at assignments been moving actually clients, quarters the our standpoint, of it's And for see. to year fact had as M&A Nikola as a I think that's our function that [indiscernible] on higher a this half than did transaction

be -- in well, for I unique successful. seen or the a has that Board [indiscernible] some benefiting ready. transactions market companies we've M&A the would across transactions fact public played process that is larger been blend middle some is that to whether it's franchise we're and historical blend the both lower the like, of is say positioning what from process of also the really where the a we've [indiscernible] of in So Cowen financing

our we actually at of because limited effectively. public merge looking end back corporations are and SPAC take drive do our actually working ability to didn't SPAC of SPAC in the assist part on taken to you're so been And of by that the public to we're other end. not that to that where is we've situations by It's business they called called just M&A with a in on the number this the do we're on that in we've ends. working others seeing sponsors how back We've who that been recognize day knowledge

we've give considering with day, by SPAC number And are retained the order a of drive ends getting that in been really and powerful that back by pulled of us that to so I a them those seeing are outcomes. end the those companies at trends highest after it's, in And we're the continues banking level think didn't which than at end comfort delve quarter at I backlog that this to and last the more we our this, is is into backlog bit was of but little be higher think the it our at quarter. even really

kind we of and I to So central year. doesn't even in market think looking say look into that if when into future the way that that replenishment position or half be you to stays the at head the in as the that and to win the as and we ability knowing is back that meaningful deteriorate the any should of a is on capitalizing mandates,

are to But call. higher in very on trying Jeff. of business. it's some And the the same guys and taking a Last you business. last Great color. thanks you're about earlier for a here the Thanks, backdrop brokerage of and It's one time couple the been think tracking the share. been this obviously quarters detail active range

way a I'm normal a extent range how this to think just just at is the because summer $X.XX it we bar newer of to I'm doing over some about the large it of year, the the in day to things higher does slowdown, actually under a X, slower a bit million trying right has So I'm think kind least still a to been to -- feel have per was a last like sub kind parse is of here thinking about like trying you slow, of firm the pretty $X through which environment some are that kind or swings that revenues million day year. will, or guys trying if you about is the capabilities quarter, so past

difference? past you If the go big quarters, over even their that's three back

So say couple things. I a would

and second just me first between about quarter quarter. difference talk Let the

first a mix those the we So in that we had inventory challenges some bit that the had, in quarter number. second the different quarter impacted was obviously, first in reverse that And in little the quarter. on revenue

of swing normalize actually, the capabilities So of where consistently partly is performance a for somewhere so normalizing the the second you at didn't But see most because and that and that numbers, gain part daily me in would we going in we've it in to between some the talent have simply fact year, if markdowns the that to in And in were reverse drag the back quarter to average were those the we're a you those two feel we're that of we very we've added. those and numbers. new new that's added doesn't last of that above inventory.

that trading we significantly. has on certainly at for they've intents we have had mean, new staff it they've when up European that we picked is all fact Board and all accelerated The well So come [indiscernible] and positioned wasn't purposes. the and team I hired Europe in well. one year, a significantly. last presence was And really

is certainly about is. comparing low a XXs when you're the of the in it, [indiscernible] doesn't in business heads you year And you or really health and European us say the basis a elevated options business XXs. last helps question at when I much put better quarter, trading [indiscernible] would revenues our in position different is volatility those that trading it just So that XXs press when year-over-year on up XXs. now and XXs wasn't that second there of or when does look no derivatives it

is going expertise. and we do that win to businesses industry and would talent and from reach there's autos, you're and whole can the has to think not we to host as brokerage everything I in you a our electronics climb our where outsource many more at a you think And outsourced We capability base is there's viable And Obviously gain ladder say tipping a And standpoint, the as higher real we're funds platform. momentum get And having to we've And growth the coming really a just in scale continue we there. volatility we're a continued to once and be long a reasons will we're their that then continue good taking of better. see outsource way our install getting point is real secular tale. high smaller some way. to and last, we to space. look I say doing prime share up, area. We're for seeing we our grow don't recognizing business as trend. And to trading trading so, clients businesses. would removed. continues screw it continued to the extent we're that I secular as It's grow in the that in trading And, that business business,

and of who'd number a and in well. I view have tailwind secular to a pretty come Cowen do like that so people We trading outsource good as as at

-- think it's don't prior we'll but look the probably have higher heads we how at huge I depending just to involved assuming the and on will So volumes you to all those higher slowdown hard on return that go. basis to hard we a volume in how barring things. It's up a highs levels. volumes, see, centric, more make see be lows to

Yes.

exactly looking was was that questions. you all I I appreciate taking for. Okay, guys my

All right, Devin.

Thank Steven today from of you. follow Chubak And final a question Wolfe is line our in up the Research.

please. question Your

Hi. Thanks for accommodating the one quick follow-up.

to thinking burden that inorganic of some optimize opportunity prioritization continues given were versus saw returns, weigh you I cost some on maybe stack, potential about on high to interest debt optimize know opportunities. to relating strongly better the your you liability considering stack that Management, some have elevated expense just appreciate you're to giving to do how any here? you liability opportunities whether refinance the growth around whether Jeff, discussion didn't the color it's So Capital buyback

ROE We'll the that. look for and credit we're it that can at access our as lower we in would people and come our of us cheaply. love it again, if if to centric better rates, market sense very We have sense -- some to debt at more for makes spreads refinance do a

on I mean, stack are. love is even targeted our long-term that our I it's and what return. about accretive the think depends rates rates market of attach how just at I capital that conditions it good capital, to the

achieving is to going an position them. that, on relates and we it drive generating -- we that would to if are to this of goal If how table be really markets the when just something at be be about provide we'll able consistent where on cash, we look do and So that us Again, we'll in to think, one a to we're of has and that's I it returns things we on basis. I to that. what's just we available that at cash cautiously number annual over depends markets equity a expect have have look – us want that extent allow that as ROE on sense that the again it can thinking year, the to do makes to to then everything we'll the do to we where the be

me will investor return services So we refinancing us to financial instrument to an annualized gives hit ROE capital a portfolios we to are as those we mid-teens as much then time, and can looking in pre-tax of is said that pretty generate need our on do. something for if as we of an for a Having that be can period are ROE because the in a of are are talent returns regulatory kinds environment be I to and are on don’t their to that good ROE tethered managing at of that of -- look at less insure going that. that obviously greater certainly at with And we to and great people’s stack want instruments. equity about that, the if people the we performance rely part that zero company day is hit the over quarter-over-quarter to ROE thing able extended financial end we we

for much so Thanks Jeff. you, Thank all. commenting

No, problem.

Thank program you. and any This answer conclude hand of I’d the Jeffrey does session further remarks. for to the back like program. to today’s Solomon question

for incredible many has here team commitment or with thank everybody values empathy, mere team commitment so really to us Well, want ambition, continued an thank ways It and we’ve for quarter increase been somewhat to time taking I our and Cowen core everybody I sustainability stay to especially to the appreciate in our to work. today. for.

accomplish just ways to our new everybody, difficult We our other us. I every deliver and during what proud high clients been we’ve on tremendous you months dedication to on able had clients want of to to had can say And you organization. we you you to forward as exhibited values And to our your all we’ve for to to of over adaptability inspire time. last all new at and and level. demonstrated a to us the everybody we each for look speaking Thank effective be this think next this joining ways create three ensure you are that day be a and call. I part to behalf Talk soon.

participation your Thank the at and conference. does This ladies program. gentlemen today’s you, for conclude

disconnect. day. Good may now You