Houlihan Lokey (NYSE:HLI) Shares Gap Up - Should You Buy?

Key Points

• Houlihan Lokey shares gapped up at the open, rising from a prior close of $136.93 to $142.86 before trading around $141.30. The move came despite recent volatility and comes with the stock still below its 200-day average.
• Analyst sentiment is mixed but generally constructive, with a Moderate Buy consensus and an average price target of $180.50. Recent reports included both target cuts and raises, reflecting differing views on near-term performance.
• The company missed quarterly earnings and revenue estimates in its latest report, though it still posted solid profitability metrics. Houlihan Lokey also raised its quarterly dividend to $0.70 per share, implying a 2.0% annualized yield.

Houlihan Lokey, Inc. (NYSE:HLI - Get Free Report)'s stock price gapped up before the market opened on Thursday . The stock had previously closed at $136.93, but opened at $142.86. Houlihan Lokey shares last traded at $141.2990, with a volume of 21,447 shares traded.

Analyst Ratings Changes

Several analysts have recently weighed in on the company. Weiss Ratings lowered Houlihan Lokey from a "hold (c+)" rating to a "hold (c)" rating in a report on Tuesday, April 21st. The Goldman Sachs Group set a $164.00 price target on shares of Houlihan Lokey in a research report on Friday, July 10th. Zacks Research upgraded Houlihan Lokey from a "strong sell" rating to a "hold" rating in a research note on Thursday, June 11th. US Capital Advisors set a $187.00 price objective on Houlihan Lokey in a report on Thursday, July 9th. Finally, Keefe, Bruyette & Woods reduced their target price on shares of Houlihan Lokey from $172.00 to $160.00 and set an "outperform" rating on the stock in a research note on Friday, July 10th. Five research analysts have rated the stock with a Buy rating and five have issued a Hold rating to the stock. Based on data from MarketBeat, the company currently has an average rating of "Moderate Buy" and a consensus target price of $180.50.

Houlihan Lokey Trading Up 0.2%

The stock has a market cap of $9.89 billion, a P/E ratio of 22.99, a price-to-earnings-growth ratio of 1.16 and a beta of 0.95. The business's fifty day simple moving average is $142.38 and its 200 day simple moving average is $155.39.

Houlihan Lokey (NYSE:HLI - Get Free Report) last issued its quarterly earnings results on Wednesday, May 6th. The financial services provider reported $1.63 earnings per share 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 company had revenue of $635.64 million during the quarter, compared to analyst estimates of $679.22 million. During the same period in the prior year, the business earned $1.96 EPS. The business's revenue for the quarter was down 4.6% on a year-over-year basis. On average, analysts predict that Houlihan Lokey, Inc. will post 7.91 earnings per share for the current fiscal year.

Houlihan Lokey Increases Dividend

The company also recently announced a quarterly dividend, which was paid on Monday, June 15th. Stockholders of record on Monday, June 1st were given a dividend of $0.70 per share. The ex-dividend date was Monday, June 1st. This is an increase from Houlihan Lokey's previous quarterly dividend of $0.60. This represents a $2.80 dividend on an annualized basis and a dividend yield of 2.0%. Houlihan Lokey's dividend payout ratio is presently 45.02%.

Insider Activity

In related news, Chairman Scott L. Beiser sold 6,265 shares of the firm'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 transaction, the chairman owned 6,265 shares in the company, valued at $941,378.90. This trade represents a 50.00% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available at the SEC website. 22.83% of the stock is owned by company insiders.

Institutional Inflows and Outflows

Several hedge funds have recently modified their holdings of HLI. Flagship Harbor Advisors LLC bought a new stake in shares of Houlihan Lokey during the 4th quarter valued at $26,000. Oakworth Capital Inc. acquired a new position in Houlihan Lokey in the fourth quarter valued at about $29,000. Core Wealth Advisors LLC bought a new position in Houlihan Lokey during the fourth quarter worth about $32,000. Eurizon Capital SGR S.p.A. acquired a new position in shares of Houlihan Lokey during the 4th quarter worth about $33,000. Finally, Strategic Wealth Investment Group LLC bought a new stake in shares of Houlihan Lokey in the 2nd quarter valued at about $39,000. 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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