Houlihan Lokey (NYSE:HLI) Releases Earnings Results, Misses Estimates By $0.16 EPS

Key Points

• Houlihan Lokey missed quarterly estimates, posting $1.63 EPS versus the $1.79 consensus and revenue of $635.64 million versus $679.22 million expected. Revenue also fell 4.6% from the same quarter last year.
• Management highlighted a strong full-year backdrop, saying FY2026 revenue rose 10% to $2.6 billion and adjusted EPS increased 20% to $7.56, supported by record backlog, pipeline, and managing-director headcount.
• The company boosted shareholder returns by raising its quarterly dividend 17% to $0.70 and repurchasing about 300,000 shares in the quarter, while ending the period with roughly $1.4 billion in cash.

Houlihan Lokey (NYSE:HLI - Get Free Report) posted its earnings results on Wednesday. The financial services provider reported $1.63 EPS for the quarter, missing analysts' consensus estimates of $1.79 by ($0.16), Zacks reports. 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 the consensus estimate of $679.22 million. During the same quarter in the prior year, the company posted $1.96 earnings per share. The firm's revenue was down 4.6% compared to the same quarter last year.

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

• Record FY2026 results — Houlihan Lokey reported $2.6 billion in revenue (up 10%) and adjusted EPS of $7.56 (up 20%), and says it finished the year with a record backlog, pipeline and number of managing directors, supporting its long‑term growth story.
• Near‑term volatility and timing delays — Q4 was uneven ($636 million revenue) as geopolitical uncertainty and software‑sector volatility extended M&A timelines and pushed the closing of two larger restructuring deals beyond quarter end, which may moderate early FY2027 growth.
• Financial Restructuring outlook has strengthened — Management cited widening credit spreads, private‑credit dislocation and energy/software dislocations as tailwinds that have driven new mandates and lead it to expect elevated restructuring activity in fiscal 2027.
• Strong balance sheet and shareholder returns — The firm ended the quarter with about $1.4 billion in cash, repurchased ~300,000 shares in Q4 and the board raised the quarterly dividend 17% to $0.70, while keeping M&A as a top capital‑allocation priority.

Houlihan Lokey Stock Performance

HLI stock traded down $0.62 during mid-day trading on Friday, reaching $152.88. 1,049,492 shares of the stock traded hands, compared to its average volume of 674,656. Houlihan Lokey has a one year low of $134.41 and a one year high of $211.78. The stock has a market capitalization of $10.67 billion, a PE ratio of 24.58, a PEG ratio of 1.09 and a beta of 0.99. The business has a 50-day moving average price of $150.56 and a two-hundred day moving average price of $168.85.

Houlihan Lokey Increases Dividend

The company also recently disclosed a quarterly dividend, which will be paid on Monday, June 15th. Shareholders of record on Monday, June 1st will be given a dividend of $0.70 per share. This represents a $2.80 dividend on an annualized basis and a yield of 1.8%. This is a positive change from Houlihan Lokey's previous quarterly dividend of $0.60. The ex-dividend date is Monday, June 1st. Houlihan Lokey's dividend payout ratio (DPR) is presently 38.59%.

Wall Street Analyst Weigh In

A number of equities research analysts recently issued reports on HLI shares. BMO Capital Markets upped their price target on shares of Houlihan Lokey from $209.00 to $211.00 and gave the company an "outperform" rating in a research note on Thursday, January 29th. Morgan Stanley reduced their target price on shares of Houlihan Lokey from $205.00 to $193.00 and set an "overweight" rating on the stock in a report on Thursday, April 9th. The Goldman Sachs Group decreased their target price on shares of Houlihan Lokey from $210.00 to $184.00 and set a "buy" rating on the stock in a research report on Wednesday, April 1st. Weiss Ratings downgraded shares of Houlihan Lokey from a "hold (c+)" rating to a "hold (c)" rating in a report on Tuesday, April 21st. Finally, UBS Group set a $160.00 price target on Houlihan Lokey in a research report on Thursday. Five research analysts have rated the stock with a Buy rating and four have given a Hold rating to the company's stock. According to data from MarketBeat.com, Houlihan Lokey has an average rating of "Moderate Buy" and a consensus target price of $191.29.

Insider Activity

In related news, General Counsel Christopher M. Crain sold 500 shares of Houlihan Lokey stock in a transaction dated Wednesday, April 1st. The shares were sold at an average price of $143.40, for a total transaction of $71,700.00. Following the completion of the transaction, the general counsel directly owned 500 shares of the company's stock, valued at approximately $71,700. The trade was a 50.00% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Company insiders own 22.83% of the company's stock.

Institutional Trading of Houlihan Lokey

Several institutional investors have recently added to or reduced their stakes in HLI. Royal Bank of Canada grew its stake in shares of Houlihan Lokey by 362.1% during the fourth quarter. Royal Bank of Canada now owns 1,703,369 shares of the financial services provider's stock valued at $296,706,000 after buying an additional 1,334,769 shares during the last quarter. Bank of Montreal Can boosted its holdings in Houlihan Lokey by 2,723.2% during the 4th quarter. Bank of Montreal Can now owns 1,199,459 shares of the financial services provider's stock valued at $208,934,000 after acquiring an additional 1,156,973 shares during the period. Bank of America Corp DE grew its position in 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 acquiring an additional 41,470 shares during the last quarter. Raymond James Financial Inc. increased its stake in Houlihan Lokey by 10.4% in the second quarter. Raymond James Financial Inc. now owns 874,078 shares of the financial services provider's stock worth $157,291,000 after purchasing an additional 82,002 shares during the period. Finally, Sei Investments Co. increased its stake in Houlihan Lokey by 4.0% in the third quarter. Sei Investments Co. now owns 717,952 shares of the financial services provider's stock worth $147,410,000 after purchasing an additional 27,328 shares during the period. Institutional investors own 78.07% of the company's stock.

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.

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