Earnings Growth and New Hires Might Change the Case for Investing in Houlihan Lokey (HLI)

• Houlihan Lokey announced its second quarter 2025 financial results, reporting net income of US$111.78 million and diluted earnings per share of US$1.63, both up from the prior year, and declared a regular quarterly dividend of US$0.60 per share payable in December.
• The company also made a significant healthcare sector hire and presented at a major global conference, highlighting ongoing investment in talent and international business development.
• We'll explore how Houlihan Lokey's stronger quarterly earnings support its ongoing pursuit of revenue growth and expanded market presence.

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Houlihan Lokey Investment Narrative Recap

To be comfortable as a Houlihan Lokey shareholder, you need confidence that the company can continue translating robust demand for independent advisory services, and sustained talent investment, into durable revenue and earnings growth. The recent earnings beat, with higher net income and a strong dividend, reflects effective business execution, but does not materially reduce the most important risk: the firm’s heavy reliance on U.S. deal activity. Any slowdown in sponsor-driven M&A or muted global activity could limit near-term revenue catalysts and challenge margin strength.

Among recent developments, the hiring of Jason Cohen as Managing Director of the Capital Solutions Group, focused on healthcare, stands out. This move fits with Houlihan Lokey’s strategy of expanding sector capabilities and broadening its client base, directly supporting its growth ambitions. It also highlights the importance of talent-driven growth, which remains central to the firm’s ability to capture new business and mitigate cyclical risks.

Yet in contrast, investors should be aware that a sustained slowdown in global M&A volumes could challenge Houlihan Lokey’s earnings momentum if...

Read the full narrative on Houlihan Lokey (it's free!)

Houlihan Lokey's outlook forecasts $3.5 billion in revenue and $654.6 million in earnings by 2028. This assumes 12.5% annual revenue growth and a $246.3 million earnings increase from the current $408.3 million.

Uncover how Houlihan Lokey's forecasts yield a $211.14 fair value, a 6% upside to its current price.

Exploring Other Perspectives

Three members of the Simply Wall St Community value Houlihan Lokey between US$100 and US$211 per share. Broader revenue growth remains tied to the pace of dealmaking, underscoring the variety in potential outcomes you should consider.

Explore 3 other fair value estimates on Houlihan Lokey - why the stock might be worth as much as 6% more than the current price!

Build Your Own Houlihan Lokey Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Houlihan Lokey research is our analysis highlighting 2 key rewards that could impact your investment decision.
• Our free Houlihan Lokey research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Houlihan Lokey's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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