Core Insights - Houlihan Lokey has strengthened its European Financial Sponsors Coverage team with the appointment of Neil Price as Managing Director in London, aiming to expand client relationships in the U.K. market and grow the overall sponsor business across Europe [1][2]. Company Developments - Neil Price joins from Mayfair Equity Partners, where he was Head of Originations, and has nearly two decades of experience at Lloyds Banking Group in senior leadership roles [3]. - The addition of Price follows the recent hiring of Martin Rezaie as Managing Director in Germany, indicating Houlihan Lokey's ongoing growth and leadership in advising financial sponsors [2][5]. Team and Expertise - The Financial Sponsors Group at Houlihan Lokey consists of over 35 professionals, including 24 Managing Directors across eight countries, managing approximately 1,900 relationships with private equity firms, credit funds, family offices, and sovereign wealth funds [5]. - The firm is recognized as a leading advisor to alternative capital providers, with a strong focus on delivering exceptional outcomes for financial sponsors [5]. Strategic Positioning - Neil Price's extensive experience in origination, structuring, and execution, along with his established relationships in the private market community, is expected to enhance the capabilities of the Financial Sponsors Coverage team [4][5]. - The firm emphasizes its global reach, deep market insight, and collaborative approach as key factors in helping clients execute complex transactions and create lasting value [5].

Core Viewpoint - Growth stocks are appealing due to their potential for above-average financial growth, but identifying strong candidates involves navigating inherent risks and volatility [1] Group 1: Company Overview - Houlihan Lokey (HLI) is highlighted as a recommended growth stock, possessing a favorable Growth Score and a top Zacks Rank [2] - The company has a historical EPS growth rate of 2.5%, but projected EPS growth for the current year is expected to be 24.1%, surpassing the industry average of 19% [4] Group 2: Financial Metrics - Cash flow growth for Houlihan Lokey stands at 40.3% year-over-year, significantly higher than the industry average of -2.5% [5] - The company's annualized cash flow growth rate over the past 3-5 years is 15.9%, compared to the industry average of 12% [6] Group 3: Earnings Estimates - There has been a positive trend in earnings estimate revisions for Houlihan Lokey, with the Zacks Consensus Estimate for the current year increasing by 1.8% over the past month [7] - The combination of a Growth Score of A and a Zacks Rank of 2 indicates that Houlihan Lokey is positioned as a potential outperformer for growth investors [9]

Core Insights - Houlihan Lokey has expanded its Capital Solutions Group with the appointment of Seran Ahmetrasit as Managing Director and Head of Infrastructure Debt Advisory for Europe, based in London [1][2][4] Group Expansion - The firm aims to enhance its infrastructure debt advisory services in Europe, leveraging its established expertise in U.S. infrastructure capital solutions [2][4] - The Capital Solutions Group now comprises over 170 professionals across 16 offices in seven countries, including major cities like London, New York, and Dubai [4] Leadership and Experience - Seran Ahmetrasit joins from Jefferies, where she was part of the Power, Utilities & Infrastructure team, and has prior experience at RBS, focusing on capital markets and structured finance [3] - Her background includes leading various transactions such as ratings advisory, structuring, acquisition financing, and refinancing, along with strong relationships with key lenders [3] Strategic Vision - The appointment of Ahmetrasit is seen as a strategic move to enhance the firm's advisory capabilities across debt and equity instruments, aiming to deliver innovative financing strategies for clients in the infrastructure sector [4] - The firm has raised and advised on approximately $28 billion across around 120 transactions in the past 12 months, indicating a robust operational capacity [4]

Core Insights - The article discusses the rise of Matt Swain as the CEO of Triago and his successful navigation of the private equity sector, particularly in the niche of "direct transactions" that connect family offices with stable businesses for acquisition opportunities [1][2][3]. Group 1: Company Overview - Matt Swain recently became the CEO of Triago and received five acquisition offers shortly after his appointment [1]. - Triago has built a profitable business model focused on matching family offices with stable companies looking to sell, a sector that has seen increased interest from various financial institutions [1][3]. - The "direct transaction" model, which allows investors to select individual deals rather than investing in pooled funds, has gained traction and is projected to reach approximately $200 billion in value this year [3][4]. Group 2: Competitive Landscape - Despite the growth of direct transactions, traditional private equity firms remain dominant, with large institutional investors still favoring pooled funds for their ability to deploy capital quickly [4]. - The increasing competition in the direct transaction space may lead to higher prices and compressed profit margins for investors [4]. - Swain has established a vast network of connections, including influential families and investment groups, which enhances his ability to identify and execute lucrative deals [4][5]. Group 3: Business Model and Strategy - Swain's approach to direct transactions emphasizes speed and efficiency, with his team able to secure funding for deals within 8 to 9 weeks, significantly faster than traditional private equity fundraising [9]. - The direct transaction model offers a unique fee structure where sponsors do not charge fees unless they achieve significant returns, which can lead to higher profit-sharing for successful deals [7][8]. - Swain's strategy includes expanding into new areas such as "continuation funds" and "co-investments," which are seen as lucrative opportunities for raising capital and enhancing investor returns [10][11]. Group 4: Future Outlook - Swain predicts that institutional investors will increasingly adopt direct transaction strategies, mirroring the stock-picking approach of selecting individual companies for investment [19]. - The anticipated growth in direct transactions could lead to a significant increase in liquidity in private markets, making them more comparable to public markets [19]. - Major pension funds are beginning to allocate capital to direct transactions, indicating a shift in investment strategies towards smaller management firms that promise higher returns [19].

Core Insights - Stephen Pollock has joined Houlihan Lokey's Capital Solutions Group as a Managing Director in Equity Capital Solutions [1] Company Overview - Houlihan Lokey's Capital Solutions Group is expanding its leadership team with the addition of Stephen Pollock [1] - Pollock will be based in New York, indicating a strategic focus on the East Coast market [1]

Financial Performance - Revenues for Q3 2025 were $659.5 million, a 15% increase from $575.0 million in Q3 2024[94] - Net income for Q3 2025 was $111.8 million, a 19% increase from $93.5 million in Q3 2024[94] - Revenues for the six months ended September 30, 2025, were $1.26 billion, a 16% increase from $1.09 billion in the same period of 2024[99] - Net income for the six months ended September 30, 2025, was $209.3 million, a 15% increase from $182.5 million in 2024[128] - Total revenues for the six months ended September 30, 2025, were $1,264.8 million, representing a 16% increase compared to $1,088.6 million for the same period in 2024[1] Operating Expenses - Total operating expenses for Q3 2025 were $508.1 million, up 14% from $444.3 million in Q3 2024[96] - Total operating expenses for the six months ended September 30, 2025, were $1,023.7 million, up 19% from $863.2 million in the same period of 2024[100] - Compensation expenses in Q3 2025 were $423.2 million, reflecting a 17% increase compared to $360.6 million in Q3 2024[96] - Compensation expenses for the six months ended September 30, 2025, were $816.0 million, an 18% increase from $690.8 million in the same period of 2024[100] - Corporate expenses increased by 21% to $71.5 million for the three months ended September 30, 2025, compared to $59.3 million for the same period in 2024[119] Profitability Metrics - The Compensation Ratio for Q3 2025 was 64.2%, compared to 62.7% in Q3 2024[96] - Total segment profit for the six months ended September 30, 2025, was $410.6 million, an 18% increase compared to $347.2 million for the same period in 2024[1] - Segment profit for Corporate Finance rose by 34% to $147.3 million for the three months ended September 30, 2025, compared to $109.7 million for the same period in 2024[108] - Segment profit for Financial Restructuring decreased by 18% to $50.1 million for the three months ended September 30, 2025, compared to $60.9 million for the same period in 2024[112] - Segment profit for Financial and Valuation Advisory increased by 31% to $25.4 million for the three months ended September 30, 2025, compared to $19.4 million for the same period in 2024[116] Tax and Other Income - The effective tax rate for Q3 2025 was 30.2%, down from 31.3% in Q3 2024[98] - Other (income) expense, net for Q3 2025 was $(8.7) million, compared to $(5.4) million in Q3 2024, primarily due to higher interest income[97] Cash Flow and Investments - Operating cash flows provided $193.4 million, down 14% from $224.7 million in the same period of 2024[129][130] - Investing activities resulted in a net outflow of $4.6 million, significantly reduced by 94% compared to $71.3 million in 2024[129][130] - Financing activities showed a net outflow of $268.8 million, an increase of 34% from $200.6 million in 2024, primarily due to employee tax obligations and dividends[129][130] - Cash, cash equivalents, and restricted cash at the end of the period totaled $928.4 million, a 34% increase from $692.9 million in 2024[128] Foreign Currency Impact - The company experienced an 80% increase in the effects of exchange rate changes on cash, from $18.2 million in 2024 to $32.8 million in 2025[128] - The net impact of foreign currency fluctuations on other comprehensive income was $34.3 million for the six months ended September 30, 2025, compared to $28.4 million in 2024[139] - A hypothetical 10% depreciation in the U.S. Dollar would have resulted in an increase in other comprehensive income of approximately $103 million for the six months ended September 30, 2025[139] - The company had no open foreign currency forward contracts as of September 30, 2025, compared to two contracts with a notional value of $37.0 million in 2024[141] Accounting Policies - There were no significant changes to critical accounting policies and estimates during the reporting period[133]

Group 1 - Houlihan Lokey, Inc. has announced the appointment of Marco Voci as a Managing Director in the global Consumer Group [1] - Marco Voci will focus on the active lifestyle, branded consumer products, and luxury goods sectors across Europe, the Middle East, and Africa (EMEA) [1] - He will collaborate closely with Alexander Grünwald, Managing Director and Global Co-Head of the Consumer Group, who leads the firm's Luxury Goods team [1]

Core Insights - JP Morgan and Houlihan Lokey ranked first in two league tables for M&A activity in the consumer sector during the first nine months of the year, according to GlobalData [1] - Morgan Stanley led in transaction value, advising on deals worth a cumulative $30.56 billion, while Houlihan Lokey advised on the highest number of deals, totaling 22 [1][2] - In the first nine months of 2024, Houlihan Lokey advised on 25 transactions, maintaining its leadership position in deal volume despite a year-on-year decline in the total number of deals [3] Transaction Details - Morgan Stanley was involved in Keurig Dr Pepper's acquisition of JDE Peet's for €15.7 billion ($18.36 billion) and the subsequent split of the combined business [2] - Houlihan Lokey's advisory work primarily focused on food transactions, including Kraft Heinz's asset sale in Italy [2] Competitor Rankings - Bank of America ranked second in deal value, advising on transactions worth $28.51 billion, followed by Lazard with $27.83 billion from 12 deals, JP Morgan with $11.08 billion, and Goldman Sachs with $10.82 billion [4] - In terms of deal volume, Spayne Lindsay led with 16 transactions, followed by Rothschild & Co. with 14, Deloitte with 13, and both Bank of America and Lazard with 12 [4] Data Source and Methodology - GlobalData's league tables are based on real-time tracking of company and advisory firm websites, with a team of analysts gathering detailed information on each deal [5]

Core Insights - Houlihan Lokey has become one of Wall Street's busiest investment banks by deal volume, with CEO Scott Adelson highlighting the firm's unexpected growth and success in the investment banking sector [1][4]. Company Overview - Scott Adelson, who has been with Houlihan Lokey since 1987, was appointed CEO last year after serving as copresident and global cohead of corporate finance [3]. - The firm has evolved from its initial focus on restructuring and bankruptcy to handling a diverse range of transactions, including advising on the sale of Color Wow to L'Oréal [4]. Financial Performance - In the second quarter of the 2026 fiscal year, Houlihan Lokey reported revenues of $659 million, a 15% increase compared to the same quarter last year [6]. - Corporate finance revenues reached nearly $439 million, up 17% year-over-year, while financial and valuation advisory services generated $87 million, reflecting a nearly 10% increase [6]. Market Position - Houlihan Lokey is recognized as the top M&A advisor by volume in 2025, having successfully navigated a competitive landscape by hiring senior dealmakers while rivals have reduced their workforce [8]. - The firm has focused on the middle-market segment, typically involving deals valued around $1 billion and under, where it has seen significant deal flow despite larger banks handling higher-value transactions [5]. Industry Trends - The investment banking sector is experiencing a rebound in dealmaking activity, attributed to a steadier rate environment, lighter regulation, and optimism surrounding AI and technology [7]. - Adelson emphasizes that the current capital market conditions are favorable, with abundant capital leading to increased confidence in dealmaking [7].

Core Insights - The article discusses the rise of "directs" in private equity, a model where investors select individual companies rather than investing in pooled funds, driven by the increasing wealth of family offices [2][6][31] - Matt Swain, CEO of Triago, has been pivotal in transforming the directs sector into a significant business, raising substantial capital and attracting attention from major investment firms [5][12][30] Company Overview - Triago, under Swain's leadership, has become a leader in the directs space, raising $3 billion in equity capital for 35 deals, which supported over $10 billion in purchases [12][30] - Houlihan Lokey, a mid-tier investment bank, acquired Triago and has since leveraged its resources to enhance the directs model, aiming to expand into new areas like continuation vehicles and co-investments [23][24][30] Market Dynamics - The directs market is projected to grow significantly, with estimates suggesting it could reach around $200 billion this year, a substantial increase from previous years [6][30] - Institutional investors, including pension funds, are beginning to show interest in directs, indicating a potential shift in investment strategies towards more direct equity investments [31][32] Investment Strategy - The directs model offers higher potential returns compared to traditional private equity, with investors seeking returns of 3x or more, contrasting with the typical 2x returns from conventional PE funds [13][31] - Directs sponsors typically do not charge fees unless they achieve significant returns, aligning their interests closely with those of their investors [14][19] Competitive Landscape - While the directs model is gaining traction, it still faces challenges in achieving mass adoption among traditional private equity investors, who prefer pooled investments for quicker capital deployment [7][31] - The success of the directs model has attracted competition, which could lead to increased prices and reduced profit margins for existing players [7][30] Future Outlook - Swain envisions a future where directs will revolutionize private equity, making it more liquid and accessible, akin to public markets [31][32] - The increasing interest from large pension funds in directs co-investments indicates a growing acceptance of this model within institutional investment strategies [32]