Value
7.8/10data confidence 83%| Component | Sub-score |
|---|---|
| P/E | 8.5 |
| P/S | 9.5 |
| Fwd P/E | 9.2 |
| PEG | 6.6 |
| Analyst target | 5.0 |
- ▸Forward P/E: 10.5x
- ▸PEG: 1.10
- ▸Attractively valued
JEF · Why this verdict
Why Jefferies Financial Group (JEF) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
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VerdictSELL
Overall score5.4/10
ConfidenceMEDIUM
MacroRISK_OFF
TrendMatrix Research · core thesis
Engine thesis — one sentence
Jefferies delivered 27% revenue growth year-over-year but trades with only 0.4% headroom to near-term resistance, RSI at 83, and an earnings report due in eight days—the growth narrative is intact but the entry geometry is unfavorable with 15% downside against near-zero upside.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Revenue grew 27% year-over-year, reflecting strong momentum in the underlying capital markets business that could support further earnings expansion if the trajectory holds. Growth breakdown | Revenue growth remains above 15% year-over-year for 2 consecutive quarters, demonstrating that the expansion is durable rather than episodic. | →Stable |
| CounterTwo of the last four quarters ended in earnings misses, including the most recent at -21.35% below consensus, suggesting revenue strength is not consistently translating to bottom-line delivery; elevated leverage at a debt-to-equity of 3.4 amplifies both upside and any shortfall. | ||
The stock trades just below near-term resistance with only 0.4% of potential upside against 15% of defined downside, producing a risk/reward ratio of roughly 0.06-to-1 that makes this an unattractive point to initiate or add to a position. Price targets | Price pulls back toward $56 over the next quarter, improving the reward-to-risk ratio to above 1.5-to-1 and restoring a favorable entry geometry. | ↓Deteriorating |
| CounterStrong on-balance volume and an above-200-MA position could drive prices through near-term resistance if the upcoming earnings report surprises positively, making the current level a launchpad rather than a ceiling. | ||
RSI at 83 places the stock in overbought territory alongside a flat or declining 200-day moving average slope, while implied volatility at 129% indicates the options market is pricing in a meaningful near-term move—conditions consistent with late-cycle distribution risk. Risk breakdown | RSI cools below 65 and implied volatility normalizes below 80% over the next quarter without a sharp price decline, indicating the overbought condition resolves by time rather than correction. | ↓Deteriorating |
| CounterRecovering MACD and sustained on-balance volume accumulation suggest institutional participation remains intact; overbought readings can persist for weeks through an earnings catalyst. | ||
Two misses in the last four quarters, including the most recent at -21.35% below consensus, introduce meaningful uncertainty into the earnings cadence with a report due in eight days. Catalyst breakdown | The next two quarters deliver consecutive positive earnings surprises of at least 5%, restoring a consistent beat pattern. | →Stable |
| CounterWhen the company beats, it does so substantially—26% and 20% in the two prior beats—suggesting the business can execute strongly under favorable conditions and that misses may reflect timing rather than structural weakness. | ||
Revenue grew 27% year-over-year, reflecting strong momentum in the underlying capital markets business that could support further earnings expansion if the trajectory holds.
→StableGrowth breakdown
- Expectation
- Revenue growth remains above 15% year-over-year for 2 consecutive quarters, demonstrating that the expansion is durable rather than episodic.
CounterTwo of the last four quarters ended in earnings misses, including the most recent at -21.35% below consensus, suggesting revenue strength is not consistently translating to bottom-line delivery; elevated leverage at a debt-to-equity of 3.4 amplifies both upside and any shortfall.
The stock trades just below near-term resistance with only 0.4% of potential upside against 15% of defined downside, producing a risk/reward ratio of roughly 0.06-to-1 that makes this an unattractive point to initiate or add to a position.
↓DeterioratingPrice targets
- Expectation
- Price pulls back toward $56 over the next quarter, improving the reward-to-risk ratio to above 1.5-to-1 and restoring a favorable entry geometry.
CounterStrong on-balance volume and an above-200-MA position could drive prices through near-term resistance if the upcoming earnings report surprises positively, making the current level a launchpad rather than a ceiling.
RSI at 83 places the stock in overbought territory alongside a flat or declining 200-day moving average slope, while implied volatility at 129% indicates the options market is pricing in a meaningful near-term move—conditions consistent with late-cycle distribution risk.
↓DeterioratingRisk breakdown
- Expectation
- RSI cools below 65 and implied volatility normalizes below 80% over the next quarter without a sharp price decline, indicating the overbought condition resolves by time rather than correction.
CounterRecovering MACD and sustained on-balance volume accumulation suggest institutional participation remains intact; overbought readings can persist for weeks through an earnings catalyst.
Two misses in the last four quarters, including the most recent at -21.35% below consensus, introduce meaningful uncertainty into the earnings cadence with a report due in eight days.
→StableCatalyst breakdown
- Expectation
- The next two quarters deliver consecutive positive earnings surprises of at least 5%, restoring a consistent beat pattern.
CounterWhen the company beats, it does so substantially—26% and 20% in the two prior beats—suggesting the business can execute strongly under favorable conditions and that misses may reflect timing rather than structural weakness.
Per-dimension breakdown
Quality
5.6/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 2.9 |
| ROA | 0.8 |
| Gross margin | 10.0 |
| Op margin | 6.3 |
| Net margin | 5.5 |
| Current ratio | 5.4 |
| Moat | 5.8 |
| Piotroski F | 7.8 |
- ▸Strong Piotroski F-Score: 7/9
Growth
5.1/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 4.6 |
| EPS growth | 5.6 |
Momentum
6.1/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 3.4 |
| MACD | 10.0 |
| OBV | 10.0 |
| MA position | 4.0 |
| Volume | 2.9 |
- ▸Volume accumulation (rising OBV)
- ▸Below 200-MA, MA slope -4.1%/30d — confirmed downtrend
Sentiment
6.3/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 5.2 |
| Analyst rating | 6.6 |
| Price target | 7.2 |
- ▸Light analyst coverage (6.0) — signal dampened
Insider
5.2/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.7 |
| notable moves | 5.0 |
- ▸No net insider activity — $0 (0.000% of mkt cap)
Peer rank
3.9/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 7.2 |
| quality rank | 3.6 |
| growth rank | 2.9 |
Technical
1.3/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 0.0 |
| support resistance | 0.0 |
| 52w position | 4.0 |
Risk (lower is worse)
4.3/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 7.5 |
| days to cover | 8.0 |
| volatility | 4.8 |
| put call | 0.0 |
| implied vol | 5.4 |
| max pain risk | 3.0 |
| beta | 4.9 |
| debt equity | 1.2 |
- ▸Elevated put/call: 2.09
- ▸Above max pain $32
Catalyst
5.1/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 3.3 |
| earnings timing | 5.0 |
| surprise avg | 1.1 |
| dividend safety | 8.0 |
| news activity | 8.0 |
- ▸Earnings concerns: 2B/2M
- ▸Dividend: 3.5%
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (6)
- MOMENTUM:6.1>=5.5
- INSIDER:OK
- 8K:CLEAN
- EARNINGS_PROXIMITY:69d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:0.1<1.5@spot
Warning (1)
- DEATH_CROSS:momentum=6.1>=5.0 recovering
Reward-to-Risk
0.10
Upside
+1.0%
Downside
10.2%
Sizing output
AVOID
SetupRecovery — Death cross but MACD improving, RSI 66
EdgeNo clear edge — No clear edge identified
SuitabilityAggressive — Beta 1.54>1.3
Investment implication
The F-path SELL output reflects an overall score of 4.9 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Value at 7.8) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( ASYMMETRY:0.1<1.5@spot) reinforce the read. Current asymmetry R:R is 0.10 — supplementary context, not the trigger for this path.
The strongest dimensions are Value at 7.8, Sentiment at 6.3, and Momentum at 6.1; the weakest are Technical at 1.3, Peer rank at 3.9, and Risk (lower is worse) at 4.3. The V9 engine flagged 1 failed gate with 1 warning, producing an asymmetric reward-to-risk of 0.10 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Strong Revenue Growth 27pct
Trip ifRevenue growth falls below 10% year-over-year for 2 consecutive quarters.
- P2At Target Unfavorable Risk Reward
Trip ifUpside to the near-term price target expands to more than 10% for 4 consecutive weeks, implying a meaningful pullback or target upgrade that restores a favorable entry opportunity.
- P3Overbought With Elevated Hedging
Trip ifPrice rallies more than 15% above current levels while RSI sustains above 75 for 4 consecutive weeks, demonstrating the overbought condition is not resolving via mean reversion.
- P4Inconsistent Earnings Delivery
Trip ifEPS surprise exceeds 5% for 2 consecutive quarters, restoring a consistent beat cadence.