Financial Data and Key Metrics Changes - The company reported revenues of $659 million for the quarter, a 15% increase year-over-year, and adjusted earnings per share of $1.84, up 26% compared to the same period last year [4][5] - Adjusted compensation expenses were $406 million, up from $354 million year-over-year, maintaining an adjusted compensation expense ratio of 61.5% [9][10] - The adjusted effective tax rate for the quarter was 29.7%, down from 31.3% in the same quarter last year [10][11] Business Line Data and Key Metrics Changes - Corporate finance revenues were $439 million, a 21% increase year-over-year, with 171 transactions closed, up from 131 in the same period last year [5][8] - Financial restructuring revenues reached $134 million, a 2% increase, with 37 transactions closed compared to 33 last year [6][8] - Financial and valuation advisory generated $87 million in revenues, a 10% increase, with 1,075 fee events, up from 903 in the same period last year [6][8] Market Data and Key Metrics Changes - The non-U.S. business performed well, particularly in the EMEA and Asia-Pacific regions, showing solid growth and improving key indicators [6] - The company noted that EMEA and Asia have outperformed the U.S. corporate finance business year-to-date, indicating strong growth potential in these regions [48] Company Strategy and Development Direction - The company is focused on maintaining strong growth in corporate finance and capital solutions, with expectations for a strong fourth quarter relative to the third quarter [5][6] - The acquisition pipeline remains strong, with ongoing efforts to attract senior talent and expand the global platform [6][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the macro environment, noting that easing interest rates and improving market conditions have bolstered deal-making confidence [4][5] - The outlook for the second half of fiscal 2026 is positive, with expectations for year-over-year growth if current conditions persist [7][12] Other Important Information - The company ended the quarter with approximately $1.1 billion in unrestricted cash and investment securities, with plans to evaluate balance sheet flexibility for acquisitions versus share repurchases [12] - The company repurchased approximately 210,000 shares during the quarter [12] Q&A Session Summary Question: Trends in restructuring business and new business activity - Management acknowledged a slowdown in new business activity in restructuring but noted a robust backlog supporting continued strength [17][18] Question: Corporate finance activity and sponsor engagement - Management confirmed an uptick in corporate finance activity, particularly after Labor Day, with sponsors actively engaging in the market [20][22][23] Question: Growth profile of financial and valuation advisory - Management described the growth profile as consisting of cyclical and non-cyclical segments, with expectations for growth in strong M&A cycles [27][29] Question: Impact of macro-negative headlines on deal-making - Management indicated that recent macro-negative headlines have not materially impacted client sentiment or acquisition strategies [68] Question: Share repurchase strategy - Management clarified that share repurchases are primarily driven by employee compensation needs and available excess cash, rather than stock performance [70][71]

Financial Data and Key Metrics Changes - The company reported revenues of $659 million for the quarter, a 15% increase year-over-year, and adjusted earnings per share of $1.84, up 26% compared to the same period last year [4] - Adjusted compensation expenses were $406 million, compared to $354 million in the same period last year, maintaining an adjusted compensation expense ratio of 61.5% [10] - The adjusted effective tax rate for the quarter was 29.7%, down from 31.3% in the same quarter last year, primarily due to decreased state taxes and taxes from foreign operations [11] Business Line Data and Key Metrics Changes - Corporate finance revenues were $439 million, a 21% increase year-over-year, with 171 transactions closed, up from 131 in the same period last year [5][9] - Financial restructuring revenues reached $134 million, a 2% increase year-over-year, with 37 transactions closed, compared to 33 in the same quarter last year [7][9] - Financial and valuation advisory generated $87 million in revenues, a 10% increase year-over-year, with 1,075 fee events, up from 903 in the same period last year [9] Market Data and Key Metrics Changes - The company noted strong performance in non-U.S. markets, particularly in EMEA and Asia-Pacific, with solid growth and improving key indicators [6] - The backlog in corporate finance suggests a shift in deal timing, with expectations for a strong fourth quarter relative to the third quarter [6] Company Strategy and Development Direction - The company is focused on maintaining growth through strategic acquisitions and hiring senior talent, with five new Managing Directors added in the quarter [6] - The outlook for the second half of fiscal 2026 is positive, with expectations for year-over-year growth if current conditions persist [8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the improving macro-environment, noting that capital markets are open and capital is plentiful, which has increased confidence in deal-making [4] - The company acknowledged some slowdown in new business activity in restructuring but emphasized a robust backlog supporting continued strong performance [18] Other Important Information - The company ended the quarter with approximately $1.1 billion in unrestricted cash and investment securities, with plans to evaluate balance sheet flexibility for acquisitions versus share repurchases [12] - The company repurchased approximately 210,000 shares during the quarter [12] Q&A Session Summary Question: Trends in restructuring business and new business activity - Management noted a slowdown in new business activity in restructuring but emphasized a robust backlog supporting continued strength [18] Question: Corporate finance activity and sponsor engagement - Management confirmed an uptick in corporate finance activity and noted that sponsors have been active since the beginning of the fiscal year [20][22] Question: Growth profile of financial and valuation advisory - Management explained that the growth profile is influenced by M&A cycles, with a portion of the business being non-cyclical [26][28] Question: Impact of macro-negative headlines on deal-making - Management indicated that recent macro-negative headlines have not materially impacted client sentiment or acquisition strategies [67] Question: Share repurchase strategy - Management clarified that share repurchases are primarily to offset employee compensation dilution and are evaluated based on acquisition opportunities [69]

Financial Data and Key Metrics Changes - The company reported revenues of $659 million for the quarter, a 15% increase year-over-year, and adjusted earnings per share of $1.84, up 26% compared to the same period last year [4][10] - Adjusted compensation expenses were $406 million, compared to $354 million in the same period last year, maintaining an adjusted compensation expense ratio of 61.5% [11][12] - The adjusted effective tax rate for the quarter was 29.7%, down from 31.3% in the same quarter last year, primarily due to decreased state taxes and taxes from foreign operations [12] Business Line Data and Key Metrics Changes - Corporate finance generated $439 million in revenues, a 21% increase year-over-year, with 171 transactions closed, up from 131 in the same period last year [5][10] - Financial restructuring revenues were $134 million, a 2% increase year-over-year, with 37 transactions closed, compared to 33 in the same quarter last year [6][10] - Financial and valuation advisory produced $87 million in revenues, a 10% increase year-over-year, with 1,075 fee events, up from 903 in the same period last year [10] Market Data and Key Metrics Changes - The non-U.S. business performed well, with solid growth in both EMEA and Asia-Pacific regions, indicating consistent brand growth and momentum outside the U.S. [8] - The company noted that EMEA and Asia have outperformed the U.S. corporate finance business year-to-date, reflecting strong activity levels in those regions [39] Company Strategy and Development Direction - The company is optimistic about the second half of fiscal 2026, expecting continued year-over-year growth if current conditions persist [4][9] - The company is focused on strategic acquisitions and hiring senior talent to drive growth, with a strong acquisition pipeline and recent hires in key regions [8][50] Management's Comments on Operating Environment and Future Outlook - Management highlighted that the macro environment has improved, with easing interest rates and a more stable deal-making environment, which is expected to enhance performance in the second half of the fiscal year [4][8] - There is recognition of episodic shocks in restructuring, but the backlog remains robust, supporting expectations for continued strong performance [18][33] Other Important Information - The company ended the quarter with approximately $1.1 billion in unrestricted cash and investment securities, with plans to evaluate balance sheet flexibility for acquisitions versus share repurchases [13] - The company repurchased approximately 210,000 shares during the quarter [13] Q&A Session Summary Question: Is there a slowdown in new business activity in restructuring? - Management acknowledged a slight slowdown in the pace of new business activity but emphasized that the backlog remains robust [18] Question: Are sponsors returning to the market? - Management confirmed that sponsor activity has been increasing since the beginning of the fiscal year, with a significant uptick noted after Labor Day [20][21] Question: What is the growth outlook for financial and valuation advisory? - Management indicated that the growth profile is influenced by cyclical and non-cyclical segments, with expectations for growth in strong M&A cycles [24][26] Question: How does the company view the impact of macro-negative headlines? - Management stated that recent macro-negative headlines have not materially impacted client sentiment or acquisition strategies [58] Question: How does the company approach share repurchases? - Management clarified that share repurchases are primarily driven by employee compensation needs and the availability of excess cash for acquisitions [59]

October 2025 Investor Presentation Disclaimers Forward-Looking Information This presentation contains forward-looking statements. All statements other than statements of historical facts contained in this presentation may be forward-looking statements. The words "may," "will," "should," "expects," "plans," "anticipates," "could," "intends," "targets," "projects," "contemplates," "believes," "estimates," "predicts," "potential" or "continue" and other expressions that are predictions of or indicate future ev ...

Core Viewpoint - Houlihan Lokey Inc. (NYSE:HLI) has shown a share price increase of 1.06% to $200.49, with a year-over-year growth of 17.03%, despite a slight decline of 0.42% over the past month, raising questions about potential overvaluation [1]. Group 1: Company Performance - The current share price of Houlihan Lokey is $200.49, reflecting a 1.06% increase in the current market session [1]. - Over the past year, the stock has appreciated by 17.03%, indicating strong performance [1]. - However, the stock has experienced a minor decline of 0.42% in the last month, suggesting some volatility [1]. Group 2: P/E Ratio Analysis - The P/E ratio of Houlihan Lokey is 33.4, which is higher than the Capital Markets industry average P/E ratio of 27.86, suggesting that investors may expect better future performance from the company compared to its peers [6]. - A higher P/E ratio could indicate that the stock is overvalued, as it reflects investor optimism about future earnings [5][6]. - The P/E ratio is a useful metric for assessing market performance but should not be used in isolation; it must be considered alongside other financial metrics and qualitative factors [10].

Core Insights - Houlihan Lokey, Inc. has announced the appointment of Jason Cohen as a Managing Director in its Capital Solutions Group [1] - Jason Cohen brings over 20 years of experience in the life sciences and pharmaceutical sectors [1] - Cohen's previous experience includes 18 years at Capital On, indicating a strong background in healthcare capital solutions [1] Company Developments - The addition of Jason Cohen is aimed at strengthening the firm's healthcare capital solutions efforts [1] - Cohen will collaborate with Brent Shepherd and Neha Shah in New York to enhance the firm's capabilities in this sector [1]

Core Insights - The private credit market, valued at $1.7 trillion, is shifting towards more frequent portfolio valuations to attract individual investors, marking a significant change from its traditionally opaque practices [2][5]. Group 1: Market Trends - Many fund managers are now offering vehicles that allow retail investors to invest on a monthly or daily basis, necessitating more frequent updates of net asset values (NAV) [3][5]. - Interval funds have raised nearly $123 billion as of Q3, reflecting a 9.4% increase from the previous period, with a significant portion allocated to debt and fixed income [6]. Group 2: Valuation Practices - The frequency of valuations has increased, with about 20% of direct lending clients now requiring monthly valuations, a notable rise from five years ago when such practices were rare [5]. - Fidelity Investments reports that 100% of its portfolio is marked by a third party every month, ensuring timely updates based on borrower performance [7]. Group 3: Challenges and Limitations - Despite more frequent NAV calculations, many firms still do not provide monthly updates on the value of individual loans, leading to potential confusion for investors [8]. - The valuation of private credit loans remains a contentious issue, especially when loans underperform, as there is no standard trading mechanism to assess their value over time [9]. - Investors are cautioned that more frequent marks do not equate to the ability to trade these products easily, as the process of buying in and withdrawing funds can be complex [10].

Core Insights - Morgan Stanley and Houlihan Lokey are the leading financial advisers in the M&A sector for Q1-Q3 2025, with Morgan Stanley leading by deal value and Houlihan Lokey by deal volume [1][2] Group 1: Morgan Stanley's Performance - Morgan Stanley advised on transactions totaling $51.5 billion in Q1-Q3 2025, maintaining its position as the top adviser by value [1][2] - The firm was the only adviser to surpass the $50 billion mark in total deal value during this period, despite a year-on-year decline [2] - Morgan Stanley participated in eight billion-dollar deals, including a mega deal valued at over $20 billion, which contributed to its top ranking by value [2] Group 2: Houlihan Lokey's Performance - Houlihan Lokey advised on 33 transactions in Q1-Q3 2025, showing significant improvement in deal volume compared to Q1-Q3 2024 [3] - The firm's ranking by value improved from 10th position to the top position due to this increase in deal volume [3] Group 3: Competitors' Performance - Evercore ranked second in deal value with $46 billion in M&A deals, followed by JP Morgan with $43.7 billion, UBS with $39.1 billion, and Goldman Sachs with $38 billion [3] - In terms of deal volume, Stifel/KBW ranked second with 32 deals, Piper Sandler third with 31 deals, and Goldman Sachs and JP Morgan secured fourth and fifth positions with 24 and 20 deals, respectively [4] Group 4: Data Source and Methodology - GlobalData's league tables are based on real-time tracking of various reliable sources, including company and advisory firm websites [5] - A dedicated team of analysts gathers in-depth details for each deal, ensuring the robustness of the data [5]

Core Insights - Goldman Sachs ranked first by deal value in the construction M&A sector, advising on transactions totaling $33.2 billion during the first three quarters of 2025 [1][2] - Houlihan Lokey led by deal volume, providing services on 12 transactions, improving its ranking from third position in Q1-Q3 2024 to the top position in Q1-Q3 2025 [1][3] Deal Value Analysis - The total value of deals advised by Goldman Sachs more than doubled quarter-on-quarter during Q1-Q3 2025, leading to an improvement in its ranking from fourth to first [2] - Eight of the ten deals advised by Goldman Sachs were billion-dollar deals, including a mega deal valued at over $10 billion, contributing to its significant increase in deal value [3] Competitor Rankings - JP Morgan secured the second spot in deal value, advising on $26.4 billion worth of transactions, followed by Bank of America with $24.4 billion, Jefferies with $21.6 billion, and Morgan Stanley with $20.2 billion [4] - In terms of volume, Jefferies and Lazard each completed 11 deals, while Goldman Sachs and JP Morgan advised on ten deals [4] Data Source and Methodology - GlobalData's league tables are based on real-time tracking of various reliable sources, with a dedicated team of analysts monitoring these sources for in-depth deal details [5]

Core Insights - Goldman Sachs has emerged as the leading financial adviser in mergers and acquisitions (M&A) based on deal value, advising on transactions totaling $432.3 billion during Q1-Q3 2025 [1] - Houlihan Lokey has led in deal volume, advising on 240 deals, significantly outpacing its competitors [2] - JP Morgan closely followed Goldman Sachs in deal value, advising on $426.8 billion worth of transactions and 79 billion-dollar deals [3][4] Deal Value - Goldman Sachs advised on 84 billion-dollar deals worth approximately $419 billion, while JP Morgan advised on 79 billion-dollar deals valued at around $411 billion [3] - Other notable advisers include Morgan Stanley, Citi, and Bank of America, with deal values of $389 billion, $273.7 billion, and $256.5 billion, respectively [4] Deal Volume - In terms of deal volume, JP Morgan ranked second with 161 deals, followed closely by Goldman Sachs with 159 deals [4] - Rothschild & Co and Ernst & Young also contributed significantly, advising on 121 and 118 deals, respectively [4] Data Source and Methodology - GlobalData's league tables are based on real-time tracking of various reliable sources, including company and advisory firm websites, with a dedicated team of analysts monitoring these sources for in-depth deal details [5]