Evercore Inc. (EVR): what the price requires

At today's price, Evercore Inc. (EVR) is priced for today's economics sustained for ~7.4 years. boothcheck doesn't publish a fair value or a price target; it shows what the price assumes, so you can judge whether that bar is too high.

Generated: 2026-07-19 · Source: https://boothcheck.com/report/EVR

Headline

FieldValue
TickerEVR
CompanyEvercore Inc.
Current price$332.52/sh
CompositionInvestment Banking & Equities 98% / Investment Management 2%

What The Price Requires (Inversion)

The assumption today's price embeds, recovered by inverting the valuation.

FieldValue
Inversion basisfee-financial
Top-of-range earnings growth must hold for7.4y
Price-to-earnings29.2x
Earnings yield3.4%

Solve inputs: computed at a 12.6% cost of equity; growth searched up to the 20% fee-earnings ceiling; each 1pp moves the implied horizon ~1.4 years.

Reconcile: at the x-ray's 9.3% required return this reads ~13.2%/yr; the models below use their own rates.

How unusual the bet is: elevated

ReferenceValue
vs own history-0.39σ
cohort percentile (of 49 peers)76
sustained it ~7.4 years at this level21%
implied end-window share0%

Valuation X-Ray

The price is justified by relative-multiple and growth-DCF.

How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.

FamilyMedian price/FVModelsReads
Asset1.40x4expensive
Earnings1.31x4expensive
Relative0.77x4justifies
Growth0.50x3justifies

Families that justify the price: Relative, Growth

The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 8.3%); the inversion above states its own rate.

Per-Model Detail (n=15)

ModelFamilyFVPrice/FVApplicableMethodology
DCF Perpetual GrowthGrowth$1876.790.18xyesFCF base $1.7B, growth 25% (input: historical growth), terminal g 4.0%, WACC 8.3%, 7yr projection
DCF Exit MultipleGrowth$660.790.50xyesExit EV/EBITDA: 373.7x / 376.7x / 379.7x (bear / base = today's held flat / bull), 7yr
Relative ValuationRelative$299.671.11xyesP/E 13.99x (blended: static sector reference 12x + trailing (TTM) 19x), scenarios: 11.2x / 14.0x / 16.8x (bear / base = reference held flat / bull), EV/EBITDA N/Ax
Simple DDMGrowth——no—
Two-Stage DDMGrowth——no—
Simple Excess ReturnAsset$192.961.72xyesBV/sh $42.58, ROE (TTM) 41.9%, ke 9.3%
Two-Stage Excess ReturnAsset$464.260.72xyes5yr excess ROE then converge to ke=9.3%
Discounted Future Market CapGrowth$482.480.69xyesRev $4.6B, growth 30% (input: historical growth; tapered), Terminal P/S: 2.4x / 3.0x / 3.6x (bear / base = today's held flat / bull, cap 12x)
Peter Lynch Fair ValueRelative$621.950.53xyesEPS $17.77, growth 35% (input: historical EPS growth), PEG=0.53 (Undervalued)
Margin TrajectoryGrowth——no—
Earnings Power ValueEarnings——no—
Residual IncomeAsset$307.061.08xyesBV $42.58 + 5yr PV of (ROE (TTM) 41.9% − Kₑ 9.3%) × BV; BV grows 8.8%/yr
Graham NumberAsset$130.482.55xyes√(22.5 × EPS $17.77 × BVPS $42.58) — Graham's conservative floor
EV/EBITDA RelativeRelative——no—
FCF YieldEarnings$374.690.89xyesFCF $1522.8M / Kₑ 9.3% — zero-growth perpetuity
SBC-Adj FCF YieldEarnings$188.061.77xyesSBC-adj FCF $0.80B (FCF $1.52B − SBC $0.72B) capitalized at Kₑ
Ben Graham FormulaEarnings$573.380.58xyesEPS $17.77 × (8.5 + 2×15.0%) × (4.4 / 5.3%)
ROIC-Justified P/BAsset——no—
P/Sales SectorRelative$328.431.01xyesRevenue $4.58B × sector P/S 3.0x
PEG Fair ValueRelative$666.380.50xyesEPS $17.77 × (PEG 1.5 × growth 25.0% (input: historical EPS growth)) → PE 37.5x
Earnings YieldEarnings$192.111.73xyesEPS $17.77 / required return 9.3% (Rf 4.3% + ERP 5.0%)
Funds From Operations MultipleRelative——no—
Clinical Phase NPVGrowth——no—
MertonAsset——no—
V5 Mechanical———no—

Solvency

FieldValue
Net cash$1.9b
Net debt / NOPAT (after-tax)-2.41x (net cash)
Net debt / operating income (pre-tax)-2.34x (net cash)
Interest coverage33.3x
Share count CAGR (dilution)0.1%
Burning cashno

Bullet Takeaways

Bull Case

Advisory firms are unusually hard to value, and understanding why is the start of the bull case. There is almost no balance sheet to anchor on, no recurring subscription line, and revenue arrives in lumps tied to deals closing. What there is, when the franchise is good, is a fee machine with extraordinary returns on the little capital it uses. Evercore earns a return on equity near 42%, generates substantial free cash flow, and carries roughly $1.9 billion of net cash against minimal debt. For a business that converts senior talent and client relationships into fees, that combination of high returns and a fortress balance sheet is the structural advantage, and it is exactly what the asset-based methods, built for capital-heavy companies, cannot see.

The franchise is firing on its core engine. The first quarter of 2026 produced record adjusted net revenues of $1.40 billion and advisory fees of $1,244.7 million, with the strongest North American advisory quarter the firm has ever reported and record first quarters across EMEA advisory, equities, and wealth management. Adjusted earnings per share of $7.53 cleared the consensus estimate near $5.57 by a wide margin. When the M&A cycle turns up, an advisory leader gets paid first and gets paid most, because the largest, most complex transactions flow to the firms with the deepest senior benches.

The capital return underlines management's confidence and compounds the per-share story. In the most recent quarter Evercore returned a record roughly $673 million to shareholders, repurchasing about 1.93 million Class A shares for $621.3 million and raising the quarterly dividend 6% to $0.89. A firm buying back nearly two million shares in a single quarter while lifting the dividend is telling investors it sees the cycle as durable, and because the model needs so little retained capital to grow, almost all of the fee earnings can be handed back. The bull case is that the M&A recovery has room to run and Evercore is positioned to capture the high-value end of it.

Bear Case

The methods disagree about Evercore in a way that is worth reading carefully, because the disagreement is the bear case. The forward-growth and peer-multiple families reach the price, but the asset-based methods read it as expensive, and the inversion is blunt about what the price requires: at roughly 33 times earnings, a 3.1% earnings yield, the market is paying for fee earnings to grow near the top of their range for about nine years. Only about 15% of fee firms growing earnings that fast have sustained the pace for nine years, and Evercore's price-to-earnings sits at the very top of its fee-financial cohort. The conservative read is the more honest one here: a cyclical fee business priced at the top of its peer group, on the assumption that a near-decade of high growth is coming, is a demanding bet however good the franchise.

The cyclicality is not a footnote; it is the nature of the business. The filing states plainly that advisory revenue is "related to the number and value of the transactions in which we are involved" and that "Unfavorable market or economic conditions, as well as volatility in the financial markets, can materially reduce the demand for our services", with risk drivers extending to "military conflicts or other geopolitical events". A record quarter is precisely the moment when peak fee revenue is most likely to be mistaken for sustainable fee revenue. M&A volumes swing with rates, confidence, and credit availability, and when they fall, an advisory firm's revenue falls with them while its senior compensation, the largest cost, does not flex nearly as fast.

The franchise also rests on people who can leave. Evercore's own filing concedes that its professionals' "expertise, skill, reputation and relationships with clients and potential clients are critical elements in maintaining and expanding our businesses" and that "Increasing the number of high-caliber, experienced senior level employees is critical to our growth efforts". That dependence cuts both ways: the bankers who generate the fees can be recruited away, taking client relationships with them, and retaining them requires ever-larger compensation that pressures margins. Add the acquisition-related charges from the Robey Warshaw deal that weighed on reported results, and the bear case is straightforward: a high-quality, people-dependent, deeply cyclical business is being priced for sustained peak-cycle growth, with a valuation at the top of its cohort that leaves no margin for the cycle to do what cycles do.

Valuation

A capital-light advisory firm is worth the fee earnings it produces, not the assets on its books, so the price is read off earnings. At about 33 times earnings, a 3.1% earnings yield, today's price implies Evercore grows its fee earnings near the top of the range for roughly nine years. The assumed pace is within what the firm has delivered in good stretches; the demanding part is the duration, the requirement that the high-growth phase persist for the better part of a decade in a business that lives and dies by the deal cycle.

The methods split along the line you would expect for a cyclical fee firm at a record. The relative-multiple and forward-growth families reach the price, while the asset-based methods read it as expensive, because book value is the wrong yardstick for a firm earning a 42% return on equity. The signal sits in the comparison to peers: Evercore's price-to-earnings is at the very top of its fee-financial cohort, which includes PJT Partners, Piper Sandler, and Houlihan Lokey. That is the market awarding Evercore a premium for being the franchise that captures the largest, most complex mandates, and it is also the part of the price most exposed if the M&A cycle cools, because a top-of-cohort multiple has the most room to compress.

Solvency is a genuine strength rather than a constraint, which is rare and worth stating plainly. Evercore holds roughly $1.9 billion of net cash against minimal debt, interest coverage runs near 28 times, and the firm is not burning cash. That balance sheet is what lets management return a record amount to shareholders even as it absorbs acquisition charges, and it removes financial risk from the equation entirely. The risk that remains is earnings risk: the price is built on continued high fee growth, and the fee stream is the most cyclical line in finance.

Catalysts

The first quarter of 2026 was a record and the clearest catalyst in the story. Evercore reported adjusted earnings per share of $7.53 against a consensus near $5.57, on record adjusted net revenues of $1.40 billion and advisory fees of $1,244.7 million. The strength was broad: the firm posted its strongest-ever North American advisory quarter and record first quarters in EMEA advisory, equities, and wealth management. Management indicated the second quarter should resemble the prior year's second quarter, which was itself a record, a signal that the deal pipeline remains full. Reported results carried acquisition-related charges tied to the Robey Warshaw transaction.

Capital return was a catalyst in its own right. Evercore returned a record roughly $673 million to shareholders in the quarter, buying back about 1.93 million Class A shares for $621.3 million and raising the quarterly dividend 6% to $0.89, payable in June. Analyst opinion is mixed, fitting a stock at the top of its cohort: KBW raised its target to $375 with an Outperform rating, while UBS lifted its target to $330 but kept a Neutral rating. The catalyst that matters from here is the durability of M&A volumes; with the price built on years of high fee growth, the next few quarters of advisory revenue are the direct test of whether the peak is a plateau or a top.

Peer Cohorts (Per Segment, With Filing Citations)

Investment Banking & Equities (reported)

Investment Management (reported)

Methodology Note

Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.

Sources

Q1 2026 results, April 2026 · Q1 2026 earnings call, April 2026 · analyst notes, 2026

View the full interactive EVR report on boothcheck