At a Glance
With a staff of approximately 275 professionals worldwide, the mission of the Equities Division is to provide institutional clients with valuable investment insight, numerous opportunities to meet with public and private company management, efficient trade execution, and professional service. In addition, the Equities Division delivers trading solutions and specialized focus on related areas of market activity, such as event-driven and merger/arbitrage, derivative strategy, and innovative solutions for managing portfolios. The Equities Division partners with the firm’s Investment Banking Division to help our corporate clients access needed capital through a variety of financing vehicles.
Year in Review
During 2019, investors were again rewarded for not being distracted by frictional geopolitics, domestic political turmoil, and challenging global economics. Instead, looking to the relative strength of the U.S. economy and an accommodative Federal Reserve policy, markets rose nearly 30 percent over the year. During a remarkable and significantly broad rally in U.S. equities, volatility once again remained subdued, and passive index funds outperformed. Notably, in this environment, with a core institutional client base trading less often, Oppenheimer’s Equity Division finished the year with overall revenue of $107.1 million, down 1.2 percent versus fiscal year 2018. Expanded company coverage, noteworthy increases in the breadth and quality of corporate access and other events, coupled with continued superior contribution from block trading, all combined to ensure we cemented our strong positioning in what remains a very challenging environment for revenue generation.
Despite a slow start to the year, following the dramatic spike in volatility at the end of 2018, we saw gradual improvement in both agency transactional flow and new issue deals throughout the year. This culminated in an especially strong fourth quarter and record December. A second half surge in Investment Banking-related revenue helped to close out the year only slightly down. Additionally, offsetting that modest decline were solid gains from important adjacent product desks, derivatives and risk arbitrage, which were both up approximately 20 percent versus 2018.
We are confident the gains in market share made in 2019 will provide a solid foundation for continued progress in 2020.
Areas of Focus
Throughout the year, Oppenheimer’s dedicated teams hosted over 500 non-deal roadshows for public and private companies. In addition, we hosted events for key opinion leaders and individual company visits, all of which combined to generate over 4,000 meetings in 2019 between individual investors and company managements. We hosted six major industry conferences throughout the year as well as another eight specialty summits featuring blockchain, fintech, oncology, emerging life sciences, and specialty pharma and rare diseases. In 2019 altogether, we hosted over 750 unique companies through our conferences and corporate access leading to over 9,000 investor meetings.
The combination of strong senior trading relationships, efficient execution, and block liquidity, coupled with our compelling analytics platform, content service intensity and corporate access, along with keen investment insights has enabled Oppenheimer to outperform our peer group with priority clients. A sharpened strategy and focus on the top 150 clients has resulted in a 25 basis point improvement in our market share.
We are confident the gains in market share made in 2019 will provide a solid foundation for continued progress in 2020. The critically important synergy between an experienced and dedicated research salesforce combined with a premier, trusted tier-one trade execution desk has helped to establish Oppenheimer with a broad and increasingly demanding institutional client base.
In addition to maintaining our momentum within the agency franchise, the Equities Division continues to make progress on important initiatives to both expand and diversify our revenue base. In the fourth quarter, we added senior staff in both sales and analytics to our derivatives and event driven desks, additions which have already helped to grow revenues in those areas, and we expect they will continue to be incrementally additive as they market more broadly to additional clients in the coming year. In our UK-based European franchise we also added senior sales leadership staff, reorganized our coverage model for the region, and revised our Research Marketing and Corporate Access to increase our business in both the UK and EU.
In partnership with our colleagues in the Fixed Income Division, we worked to establish a new business initiative focused on developing a client base of institutional and family office clients who will choose Oppenheimer as custodian of their assets, and to which the Equities Division will offer further products and services on a fee basis. We expect over the next several years to establish a revenue base separate from, and incremental to, our existing business.
Companies in Our
Companies in Our
Senior Research Analysts
Senior Research Analysts