Assessing Lazard’s True Value Amid Expansion Into Tech and Advisory Services in 2025

• Thinking about whether Lazard is a bargain, overpriced, or right in the sweet spot? You are not alone. Let's untangle what the numbers actually tell us about its real value.
• Lazard's share price is down 3.1% over the past week and 2.6% over the last month, with a year-to-date dip of 5.5%. Zoom out, and the stock has gained an impressive 51.7% in three years and 61.4% in five.
• Recent headlines focus on Lazard's expansion of its advisory services and a renewed push into tech and restructuring. These moves have caught the attention of both growth-minded and value-oriented investors. This industry repositioning, alongside ongoing macroeconomic shifts, has created some volatility and fresh debate around the stock's long-term trajectory.
• Lazard scores a perfect 6 out of 6 on our undervaluation checks, which is worth a closer look through all the usual valuation yardsticks. Stick with us to discover a smarter way to look at value by the end of the article.

Find out why Lazard's -13.3% return over the last year is lagging behind its peers.

Approach 1: Lazard Excess Returns Analysis

The Excess Returns model evaluates how much additional profit Lazard generates from its capital relative to the minimum required by investors. This approach focuses on return on invested capital and how sustainably the company can out-earn its cost of equity.

For Lazard, the numbers are striking. The Book Value per share stands at $8.87, with a Stable Earnings Per Share (EPS) of $5.02, based on the median return on equity from the past five years. The Cost of Equity per share is $1.26, so the Excess Return, essentially the surplus value generated, is $3.77 per share. Over the long term, Lazard has delivered an impressive average Return on Equity of 37.56%. In addition, the Stable Book Value is forecasted at $13.37 per share, leveraging estimates from multiple analysts.

Combining these inputs, the Excess Returns model results in an intrinsic value that is approximately 35.9% above the current share price. This suggests that Lazard is trading at a significant discount to its true underlying worth, indicating meaningful upside potential for investors.

Result: UNDERVALUED

Our Excess Returns analysis suggests Lazard is undervalued by 35.9%. Track this in your watchlist or portfolio, or discover 927 more undervalued stocks based on cash flows.

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Lazard.

Approach 2: Lazard Price vs Earnings

The Price-to-Earnings (PE) ratio is a widely used tool for evaluating profitable companies like Lazard, as it captures both current profitability and the market’s expectations of future earnings growth. For steady earners, the PE ratio gives a clear comparison of how much investors are paying for each dollar of earnings, making it especially relevant for firms with consistent positive earnings.

Market participants often accept paying a higher PE for companies with superior growth outlooks or lower risk. A fair or “normal” PE incorporates these variables and adjusts with shifts in expectations or risk profiles. For Lazard, the current PE ratio stands at 17.05x, notably below both the industry average of 23.59x and the peer group average of 24.10x. On paper, this suggests Lazard is trading at a discount compared to its marketplace rivals.

This is where Simply Wall St’s proprietary “Fair Ratio” offers a smarter perspective. Rather than just benchmarking against generic industry or peer averages, the Fair Ratio for Lazard is 19.71x. This number takes into account Lazard’s earnings growth, risk profile, profit margins, industry characteristics, and market cap. By blending these nuanced factors, the Fair Ratio provides a more precise and holistic gauge of what the PE should be.

Comparing Lazard’s actual PE of 17.05x to its Fair Ratio of 19.71x, the stock appears undervalued by this measure, indicating there could be further room for upside as the market reassesses its value.

Result: UNDERVALUED

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover 1430 companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your Lazard Narrative

Earlier we mentioned that there is an even better way to understand valuation, so let's introduce you to Narratives. In simple terms, a Narrative lets you tell your story about a company like Lazard by tying your perspective, such as your own estimates of future revenue, earnings, and margins, to a personalized fair value calculation. This approach links the company's bigger picture to its financial outlook and, ultimately, what you believe its shares should be worth.

Narratives are an easy, accessible tool available to everyone on Simply Wall St's Community page, used by millions of investors. By comparing the fair value from your Narrative to the current share price, you can decide whether it is time to buy, hold, or sell. Whenever new information arises, like fresh earnings results or important news, your Narrative updates dynamically, giving you a living, breathing investment thesis.

For example, two Lazard investors may have very different views: one could build a bullish Narrative, forecasting $4.2 billion in 2028 revenue and a $65 share price, while another, taking a more cautious view, may estimate muted earnings growth and assign a fair value closer to $52. Narratives let you harness both the numbers and the story behind them, powering smarter, more dynamic investment decisions that truly fit your perspective.

Do you think there's more to the story for Lazard? Head over to our Community to see what others are saying!

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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