Houlihan Lokey (NYSE:HLI) Cut to "Sell" at Wall Street Zen

Key Points

• Wall Street Zen downgraded Houlihan Lokey to “sell” from “hold,” while the broader analyst consensus remains “Moderate Buy” with an average price target of $166.38.
• Houlihan Lokey reported weaker-than-expected quarterly results, with EPS of $1.35 versus the $1.64 consensus estimate and revenue of $511 million versus $602.38 million; revenue fell 15.6% year over year.
• Shares opened at $129.26, below the company’s 50-day and 200-day moving averages, while institutional investors held 78.07% of the stock and insiders owned 22.53%.

Houlihan Lokey (NYSE:HLI - Get Free Report) was downgraded by Wall Street Zen from a "hold" rating to a "sell" rating in a report released on Saturday.

A number of other research firms have also recently commented on HLI. Weiss Ratings restated a "hold (c)" rating on shares of Houlihan Lokey in a report on Friday, July 17th. UBS Group dropped their target price on shares of Houlihan Lokey from $161.00 to $147.00 and set a "neutral" rating on the stock in a research note on Thursday, July 30th. Morgan Stanley decreased their price target on shares of Houlihan Lokey from $187.00 to $177.00 and set an "overweight" rating for the company in a research note on Thursday, July 30th. The Goldman Sachs Group reduced their price objective on Houlihan Lokey from $171.00 to $148.00 and set a "buy" rating on the stock in a report on Thursday, July 30th. Finally, Bank of America started coverage on Houlihan Lokey in a report on Friday, July 10th. They issued a "buy" rating and a $164.00 target price for the company. Five investment analysts have rated the stock with a Buy rating and five have assigned a Hold rating to the stock. According to MarketBeat, the company has a consensus rating of "Moderate Buy" and a consensus target price of $166.38.

Houlihan Lokey Price Performance

Shares of NYSE:HLI opened at $129.26 on Friday. The firm has a market capitalization of $8.93 billion, a PE ratio of 21.73, a price-to-earnings-growth ratio of 1.42 and a beta of 0.95. The business has a 50 day simple moving average of $137.44 and a two-hundred day simple moving average of $150.13. Houlihan Lokey has a 1 year low of $112.83 and a 1 year high of $211.78.

Houlihan Lokey (NYSE:HLI - Get Free Report) last issued its quarterly earnings results on Wednesday, July 29th. The financial services provider reported $1.35 earnings per share (EPS) for the quarter, missing analysts' consensus estimates of $1.64 by ($0.29). The business had revenue of $511.00 million for the quarter, compared to the consensus estimate of $602.38 million. Houlihan Lokey had a return on equity of 20.20% and a net margin of 16.10%.Houlihan Lokey's revenue was down 15.6% on a year-over-year basis. During the same period in the prior year, the business posted $2.14 earnings per share. Equities research analysts expect that Houlihan Lokey will post 7.13 EPS for the current fiscal year.

Insiders Place Their Bets

In other Houlihan Lokey news, Chairman Scott L. Beiser sold 6,265 shares of the company's stock in a transaction on Thursday, May 21st. The stock was sold at an average price of $150.26, for a total transaction of $941,378.90. Following the completion of the sale, the chairman owned 6,265 shares in the company, valued at $941,378.90. This represents a 50.00% decrease in their ownership of the stock. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available at the SEC website. 22.53% of the stock is currently owned by corporate insiders.

Institutional Investors Weigh In On Houlihan Lokey

A number of hedge funds have recently made changes to their positions in the stock. Royal Bank of Canada grew its stake in Houlihan Lokey by 2.8% in the first quarter. Royal Bank of Canada now owns 1,751,495 shares of the financial services provider's stock valued at $251,551,000 after purchasing an additional 48,126 shares during the last quarter. Geode Capital Management LLC lifted its position in shares of Houlihan Lokey by 6.4% during the fourth quarter. Geode Capital Management LLC now owns 1,418,549 shares of the financial services provider's stock valued at $247,133,000 after buying an additional 84,757 shares during the last quarter. Bank of Montreal Can lifted its position in shares of Houlihan Lokey by 2,723.2% during the fourth quarter. Bank of Montreal Can now owns 1,199,459 shares of the financial services provider's stock valued at $208,934,000 after buying an additional 1,156,973 shares during the last quarter. Bank of America Corp DE boosted its holdings in shares of Houlihan Lokey by 4.1% in the 2nd quarter. Bank of America Corp DE now owns 1,041,990 shares of the financial services provider's stock valued at $187,506,000 after buying an additional 41,470 shares in the last quarter. Finally, Capital Research Global Investors grew its position in shares of Houlihan Lokey by 0.6% in the 4th quarter. Capital Research Global Investors now owns 962,263 shares of the financial services provider's stock worth $167,617,000 after buying an additional 5,822 shares during the last quarter. 78.07% of the stock is currently owned by hedge funds and other institutional investors.

About Houlihan Lokey

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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