Houlihan Lokey, Inc. $HLI Shares Sold by Capital International Investors

Key Points

• Capital International Investors cut its Houlihan Lokey stake by 45.1% in the fourth quarter, though it still held 313,232 shares valued at about $54.6 million. Institutional ownership remains high at 78.07%.
• Houlihan Lokey missed quarterly expectations, reporting EPS of $1.63 versus $1.79 expected and revenue of $635.64 million versus $679.22 million expected. Shares were trading down 1.7% at $136.86, near the stock’s 52-week low.
• The company raised its quarterly dividend to $0.70 per share from $0.60, equal to an annualized yield of 2.0%. Analysts are mixed overall, with a consensus rating of Hold and an average price target of $191.29.

Capital International Investors trimmed its stake in Houlihan Lokey, Inc. (NYSE:HLI - Free Report) by 45.1% during the fourth quarter, according to its most recent disclosure with the SEC. The fund owned 313,232 shares of the financial services provider's stock after selling 257,672 shares during the quarter. Capital International Investors owned approximately 0.45% of Houlihan Lokey worth $54,562,000 as of its most recent SEC filing.

Other hedge funds also recently added to or reduced their stakes in the company. ING Groep NV bought a new stake in Houlihan Lokey in the third quarter valued at $4,640,000. JPMorgan Chase & Co. lifted its stake in Houlihan Lokey by 9.0% in the third quarter. JPMorgan Chase & Co. now owns 174,695 shares of the financial services provider's stock valued at $35,868,000 after buying an additional 14,483 shares during the last quarter. Wealth High Governance Capital Ltda lifted its stake in Houlihan Lokey by 45.2% in the third quarter. Wealth High Governance Capital Ltda now owns 72,000 shares of the financial services provider's stock valued at $14,783,000 after buying an additional 22,400 shares during the last quarter. King Luther Capital Management Corp lifted its stake in Houlihan Lokey by 639.9% in the third quarter. King Luther Capital Management Corp now owns 44,578 shares of the financial services provider's stock valued at $9,153,000 after buying an additional 38,553 shares during the last quarter. Finally, Vanguard Group Inc. lifted its stake in Houlihan Lokey by 0.3% in the third quarter. Vanguard Group Inc. now owns 5,305,182 shares of the financial services provider's stock valued at $1,089,260,000 after buying an additional 13,750 shares during the last quarter. 78.07% of the stock is currently owned by institutional investors.

Wall Street Analysts Forecast Growth

A number of equities research analysts have issued reports on the company. UBS Group set a $160.00 target price on Houlihan Lokey in a research note on Thursday, May 7th. Zacks Research cut shares of Houlihan Lokey from a "hold" rating to a "strong sell" rating in a research note on Wednesday, May 13th. Keefe, Bruyette & Woods cut their price objective on shares of Houlihan Lokey from $177.00 to $172.00 and set an "outperform" rating on the stock in a research note on Thursday, May 7th. Morgan Stanley cut their price objective on shares of Houlihan Lokey from $205.00 to $193.00 and set an "overweight" rating on the stock in a research note on Thursday, April 9th. Finally, Weiss Ratings cut shares of Houlihan Lokey from a "hold (c+)" rating to a "hold (c)" rating in a research note on Tuesday, April 21st. Five research analysts have rated the stock with a Buy rating, three have assigned a Hold rating and one has assigned a Sell rating to the company's stock. According to data from MarketBeat, the company currently has a consensus rating of "Hold" and an average target price of $191.29.

Houlihan Lokey Trading Down 1.7%

HLI stock opened at $136.86 on Tuesday. Houlihan Lokey, Inc. has a one year low of $134.41 and a one year high of $211.78. The firm has a market capitalization of $9.45 billion, a PE ratio of 22.00, a P/E/G ratio of 1.08 and a beta of 0.95. The firm has a 50-day moving average of $149.66 and a two-hundred day moving average of $162.62.

Houlihan Lokey (NYSE:HLI - Get Free Report) last posted its quarterly earnings data on Wednesday, May 6th. The financial services provider reported $1.63 EPS for the quarter, missing analysts' consensus estimates of $1.79 by ($0.16). Houlihan Lokey had a net margin of 16.26% and a return on equity of 22.88%. The firm had revenue of $635.64 million for the quarter, compared to analysts' expectations of $679.22 million. During the same period in the prior year, the company posted $1.96 earnings per share. Houlihan Lokey's quarterly revenue was down 4.6% compared to the same quarter last year. On average, equities research analysts anticipate that Houlihan Lokey, Inc. will post 8.54 earnings per share for the current year.

Houlihan Lokey Increases Dividend

The firm also recently disclosed a quarterly dividend, which will be paid on Monday, June 15th. Investors of record on Monday, June 1st will be paid a $0.70 dividend. The ex-dividend date of this dividend is Monday, June 1st. This represents a $2.80 annualized dividend and a yield of 2.0%. This is an increase from Houlihan Lokey's previous quarterly dividend of $0.60. Houlihan Lokey's dividend payout ratio (DPR) is currently 45.02%.

Insider Activity

In related news, Chairman Scott L. Beiser sold 6,265 shares of the 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 completion of the sale, the chairman directly owned 6,265 shares of the company's stock, valued at approximately $941,378.90. This represents a 50.00% decrease in their position. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is accessible through this hyperlink. Also, General Counsel Christopher M. Crain sold 500 shares of the stock in a transaction dated Wednesday, April 1st. The stock was sold at an average price of $143.40, for a total value of $71,700.00. Following the completion of the sale, the general counsel directly owned 500 shares of the company's stock, valued at approximately $71,700. This represents a 50.00% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. 22.83% of the stock is currently owned by corporate insiders.

Houlihan Lokey 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.

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