Houlihan Lokey (NYSE:HLI) Announces Earnings Results

Houlihan Lokey (NYSE:HLI) posted its earnings results on Wednesday. The financial services provider reported $1.35 earnings per share (EPS) for the quarter, missing the consensus estimate of $1.64 by ($0.29), Zacks reports. Houlihan Lokey had a return on equity of 20.11% and a net margin of 16.10%.The firm had revenue of $511.00 million during the quarter, compared to the consensus estimate of $602.38 million. During the same quarter in the previous year, the company earned $2.14 EPS. The business’s revenue was down 15.6% compared to the same quarter last year.

Here are the key takeaways from Houlihan Lokey’s conference call:

• First-quarter results were weak: Revenue was $511 million and adjusted EPS was $1.35, with Corporate Finance revenue down 24% year over year to $303 million. Deal closings were delayed by geopolitical uncertainty, consumer-sector weakness, and disruption in software valuations, disproportionately affecting larger-fee transactions.
• Management characterized the Corporate Finance slowdown as a temporary delay rather than a structural deterioration. Backlog, pipeline, and new mandate activity remain at record levels, but executives cautioned that persistent Middle East-related uncertainty makes the timing of a broader middle-market recovery difficult to predict.
• Financial and Valuation Advisory revenue increased 13% to $89 million, supported by growth across all three service lines and strong large-cap activity. Financial Restructuring revenue was $119 million, and management expects elevated restructuring activity to continue amid energy-market volatility, private-credit dislocation, and software-sector stress.
• Houlihan Lokey expects to close its acquisition of energy-sector investment bank Intrepid Financial Partners by the end of the second fiscal quarter, adding 32 employees. The company also reported a robust acquisition and senior-talent pipeline and said it remains committed to strategic expansion despite near-term revenue pressure.

Houlihan Lokey Price Performance

Shares of NYSE HLI traded down $3.12 during trading on Friday, reaching $125.22. 429,715 shares of the stock traded hands, compared to its average volume of 696,449. Houlihan Lokey has a 52-week low of $112.83 and a 52-week high of $211.78. The company has a 50-day moving average of $139.93 and a 200-day moving average of $152.32. The stock has a market capitalization of $8.65 billion, a P/E ratio of 21.07, a price-to-earnings-growth ratio of 1.18 and a beta of 0.95.

Houlihan Lokey Announces Dividend

The company also recently announced a quarterly dividend, which will be paid on Tuesday, September 15th. Shareholders of record on Tuesday, September 1st will be paid a $0.70 dividend. The ex-dividend date is Tuesday, September 1st. This represents a $2.80 annualized dividend and a dividend yield of 2.2%. Houlihan Lokey’s payout ratio is presently 47.06%.

Wall Street Analysts Forecast Growth

Several equities analysts have commented on the stock. Keefe, Bruyette & Woods dropped their target price on shares of Houlihan Lokey from $160.00 to $153.00 and set an “outperform” rating on the stock in a research report on Thursday. UBS Group decreased their price target on Houlihan Lokey from $161.00 to $147.00 and set a “neutral” rating for the company in a research report on Thursday. Bank of America began coverage on Houlihan Lokey in a report on Friday, July 10th. They set a “buy” rating and a $164.00 price target on the stock. Weiss Ratings restated a “hold (c)” rating on shares of Houlihan Lokey in a research note on Friday, July 17th. Finally, Zacks Research upgraded shares of Houlihan Lokey from a “strong sell” rating to a “hold” rating in a research report on Thursday, June 11th. Five equities research analysts have rated the stock with a Buy rating and five have issued a Hold rating to the stock. According to MarketBeat.com, the stock has a consensus rating of “Moderate Buy” and a consensus price target of $174.62.

Insiders Place Their Bets

In related news, Chairman Scott L. Beiser sold 6,265 shares of the business’s stock in a transaction dated Thursday, May 21st. The stock was sold at an average price of $150.26, for a total value of $941,378.90. Following the sale, the chairman directly owned 6,265 shares in the company, valued at approximately $941,378.90. The trade was a 50.00% decrease in their position. The sale was disclosed in a legal filing with the SEC, which is accessible through this hyperlink. Company insiders own 22.83% of the company’s stock.

Hedge Funds Weigh In On Houlihan Lokey

Several large investors have recently modified their holdings of the business. Pacer Advisors Inc. boosted its holdings in Houlihan Lokey by 11.5% in the 4th quarter. Pacer Advisors Inc. now owns 8,065 shares of the financial services provider’s stock worth $1,405,000 after buying an additional 830 shares during the period. Cim LLC raised its holdings in Houlihan Lokey by 2.7% during the 4th quarter. Cim LLC now owns 8,200 shares of the financial services provider’s stock valued at $1,428,000 after acquiring an additional 215 shares during the period. Empowered Funds LLC lifted its position in shares of Houlihan Lokey by 3.1% during the fourth quarter. Empowered Funds LLC now owns 24,969 shares of the financial services provider’s stock worth $4,349,000 after acquiring an additional 745 shares in the last quarter. XTX Topco Ltd purchased a new stake in shares of Houlihan Lokey during the fourth quarter worth $3,157,000. Finally, SummitTX Capital L.P. bought a new position in shares of Houlihan Lokey in the fourth quarter worth $1,238,000. Hedge funds and other institutional investors own 78.07% of the company’s stock.

Key Stories Impacting Houlihan Lokey

Here are the key news stories impacting Houlihan Lokey this week:

• Positive Sentiment: Morgan Stanley maintained an “overweight” rating with a revised $177 price target, while Keefe, Bruyette & Woods retained an “outperform” rating with a $153 target. Both targets imply substantial potential upside from recent trading levels. Analyst price target updates
• Positive Sentiment: Houlihan Lokey declared a quarterly dividend of $0.70 per share, payable September 15 to shareholders of record September 1. The dividend equates to an annualized payout of approximately $2.80 per share and a yield of about 2.2%, providing some income support for investors.
• Neutral Sentiment: UBS lowered its price target from $161 to $147 and maintained a “neutral” rating. Although the new target still indicates potential upside, the reduction reflects more cautious expectations. Houlihan Lokey Given New Price Target at UBS Group
• Negative Sentiment: Fiscal first-quarter earnings were well below expectations: adjusted EPS was $1.35 versus the $1.64 consensus estimate, while revenue was $511 million compared with forecasts of $602.38 million. Revenue declined 15.6% year over year, and EPS fell from $2.14 in the prior-year period, signaling weaker near-term deal activity and profitability. Houlihan Lokey Reports First Quarter Fiscal 2027 Financial Results
• Negative Sentiment: The broad analyst response was cautious, with UBS cutting its target by $14 and Morgan Stanley and KBW also lowering their targets despite retaining bullish ratings. The combination of the earnings miss and downward revisions is the primary reason sentiment around HLI has weakened.

Houlihan Lokey Company Profile

Houlihan Lokey, Inc is a global investment bank and financial services firm founded in 1972 and headquartered in Los Angeles, California. The company specializes in advisory services across a broad range of transaction types and financial matters. Since its founding, Houlihan Lokey has grown to serve corporations, financial sponsors, and government entities worldwide, providing expertise in complex and high-stakes engagements.

The firm’s core service offerings include mergers and acquisitions advisory, capital markets advisory, financial restructuring and distressed M&A, and valuation and fairness opinions.