Shares of investment banks are up lately, but none can match the recent performance of Jefferies Group Inc.

Its shares rose 33% from Nov. 18 through Monday. That makes it a standout even amid a general market rally-and a surge among investment banks on merger speculation after Deutsche Bank AG announced its deal to buy Bankers Trust Co.

Frank E. Baxter, chairman and chief executive, sought to deflate any notion that he is about to sell Jefferies. "There isn't anything going on that isn't already in the public eye," he said in a telephone interview.

But the share price movement left analysts groping for other explanations.

Some observers say Jefferies shares-which fell this summer with the rest of the group though the company's business mix is steadier than its competitors' - may simply have been due for a rebound. And others said investors may be hoping to benefit from the planned spinoff of Jefferies' investment technology group in January.

"I see no rhyme or reason for what's happening," said a Jefferies executive. "In the past we've risen with the other investment banks, but lately we've been scratching our heads."

In fact, the rise of Jefferies may simply reflect investor eagerness to pile up shares in anything related to finance and technology after they furiously sold off such shares in August and September. In addition to being an investment bank, Jefferies Group is the majority shareholder in the biggest off-floor equity trading company.

A sale seems unlikely now because - the pending Bankers Trust sale notwithstanding - regulatory filings indicate this is a difficult time to sell an investment bank to a commercial bank. Over a dozen such sales have occurred in the past 18 months, and few commercial bankers appear to have the appetite anymore to swallow a regional investment bank.

A year ago firms like Montgomery Securities put themselves up for auction and watched the commercial bankers line up to bid. These days firms like Scott & Stringfellow Financial Inc. scour around, looking for buyers.

Executives at the Richmond, Va., company decided to sell in the spring. After negotiations with one bank failed to result in a deal, representatives of Scott & Stringfellow traveled to Winston-Salem, N.C., on May 21 to see if executives at BB&T Corp. were interested in a deal, according to a regulatory filing issued last week. Scott & Stringfellow's chief executive followed up that meeting with a phone call to BB&T's chairman.

Though BB&T officials were interested, they didn't pounce right away; representatives of the two companies met four more times before BB&T made an offer. BB&T agreed on Aug. 10 to buy Scott & Stringfellow.

Like Scott & Stringfellow, much of Jefferies' investment banking is with small and midsize companies. Most of its underwriting is in junk bonds, and many of its bankers are alumni of Drexel Burnham Lambert who specialize in such areas as energy and telecommunications.

But Jefferies' bread and butter is its institutional trading business, which may be less profitable than leading initial public offerings but provided a steady stream of cash when the markets seized up in the third quarter. Jefferies' net third-quarter earnings rose 9% over last year's, making it the only major securities firm in the quarter to post a gain from a year earlier.

Part of the reason the firm weathered the capital markets storm so well was that it owns 82.3% of Investment Technology Group Inc., the largest off-floor equity trading firm, according to Michael A. Flanagan, an independent securities analyst. That business made good money matching sellers with buyers during August and September, he said.

But Jefferies plans to spin off ITG in January, pending Internal Revenue Service approval. In the meantime, ITG's shares have soared 51% since Nov. 18 and Mr. Baxter said his company's rise may be related to that.

But Jefferies may have been due for a recovery analysts say.

Its shares tumbled to 125% of the company's book value during the recent market downturn, but now trade at over 320% of book, a healthy valuation for an investment bank. (Morgan Stanley trades at 310% of book.)

"People threw out the baby with the bathwater," said Mr. Flanagan. "Now they're realizing that regardless of how the market moves, Jefferies does well."

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