Edward Jones Earnings Rise in Q2 Thanks to Rising Asset Values


As its once industry-leading financial advisor workforce shrinks, one of the world’s largest wealth managers is developing with a different approach to hiring.

St. Louis-based Edward Jones increased its revenue, profits and client assets by double digits in the second quarter thanks to the rise in stock values ​​and entry into its advisory programs and other types of accounts, according to to an August 6 filing with the SEC by its parent company, The Jones Financial Companies. Yet the company lost 100 net advisers from the previous quarter and 244 from a year ago. Edward Jones’ new method of hiring could mean fewer inbound advisers, according to filing ratings.

Note: Key metrics refer, where possible, to the company’s operations in the United States, rather than its combined results, including those in Canada, where it has 878 advisors. The company breaks up most, but not all of its returns between the two countries.

  • Earnings: Edward Jones achieved income before partner allocations of $ 442 million on net sales of $ 2.95 billion in the second quarter. Much higher asset-based fee income than a year ago, due to share values ​​and accounts receivable inflows, drove up 55% profit and overall revenue in the US. United by 31%. Asset-based commission revenue jumped 39% year-over-year to $ 2.33 billion in the second quarter, more than offsetting higher spending on advisor compensation due to the increased activities.
  • Client assets: Supported Client Assets Soared 31% From Same Period Last Year To $ 1.68 Trillion In Q2, Thanks To Rising Equity Values ​​And New Net Assets which jumped 49% from the same period in 2020 to $ 21.7 billion. The average value in the quarter of each type of average client asset increased by at least 23% over the previous year: advisory programs ($ 613.7 billion); mutual fund assets held outside advisory programs ($ 571.3 billion); insurance ($ 89.0 billion); and cash ($ 48.9 billion).
  • Recruitment: The firm’s workforce fell by 1% to 17,977 advisers. Edward Jones took a temporary hiatus from recruiting in 2020 during the coronavirus. He started hiring again in the second quarter in the middle settling a trial for racial discrimination and an ongoing discussion across the industry on how to provide pathways to the profession without using traditional training methods telephone canvassing and sales between friends and family. “The Partnership remains committed to fostering the growth of financial advisors to continue serving existing and future clients and to create a positive impact in our communities by hiring both experienced financial advisors and unlicensed candidates in future periods,” according to the file. Edward Jones, he continues, is “engaged in an innovative and intentional strategy to increase its impact by providing a plan and resources to both current financial advisors and new hires that aims to foster the success of the team in the branch. This approach may result in the hiring of fewer financial advisors than in previous periods. “
  • Remark: Last month, for the 12th time in a row, Edward Jones received the highest satisfaction scores among employee advisers in the annual JD Power survey. The company is deploying additional resources to support its more than 15,000 branches to meet the specific needs of their customers, managing partner Penny Pennington said in a statement. “As we continue to focus on impactful growth, we are implementing tailored plans for our financial advisors to enable them to better serve current clients and develop meaningful relationships with new ones,” said Pennington said. “This is how we aim to help them. more people are realizing what is really important to them.
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