Houlihan Lokey Inc (HLI)

Houlihan Lokey Inc. Stock Overview

Company Profile:

History and Background:

• Founded in 1972 by George H. Lokey and Scott L. Houlihan.
• Originally named Houlihan Lokey Howard & Zukin.
• Became publicly traded in 2015.
• Headquartered in Los Angeles, California.

Core Business Areas:

• Investment Banking: Financial advisory services for M&A, capital raising, and restructuring.
• Financial Restructuring: Assisting companies in financial distress.
• Financial Services: Valuation, fairness opinions, and other financial services.

Leadership Team:

• Scott Beiser, CEO & President.
• Robert Caruso, CFO.
• Douglas Fleurot, Head of Corporate Finance.
• Matthew Lewis, Head of Financial Restructuring.

Top Products and Market Share:

• Investment Banking: Ranked 13th globally in M&A advisory by deal count in 2022.
• Financial Restructuring: Leading player in the industry, consistently ranked among the top 5 advisors.
• Financial Services: No specific product dominance, but a strong reputation for expertise and client service.

Total Addressable Market:

• Global M&A market: $4.9 trillion in 2022.
• US M&A market: $2.2 trillion in 2022.
• Financial Restructuring market: Estimated at $20 billion globally.

Financial Performance:

• Revenue: $1.7 billion in 2022, a 20% increase year-over-year.
• Net Income: $520 million in 2022, a 40% increase year-over-year.
• Profit Margin: 30.5% in 2022.
• EPS: $2.60 in 2022.
• Strong cash flow and balance sheet health.

Dividends and Shareholder Returns:

• Dividend History: Irregular dividend payments, currently yielding 0.25%.
• Shareholder Returns: 1-year return of 25%, 5-year return of 150%, 10-year return of 500%.

Growth Trajectory:

• Historical growth: Revenue and earnings have grown significantly over the past 5-10 years.
• Future growth: Expected to continue benefiting from strong M&A activity and market demand.
• Recent launches: Expanded into new markets and service offerings.

Market Dynamics:

• M&A market: High activity driven by low interest rates and strong economic conditions.
• Financial Restructuring market: Increasing demand due to rising interest rates and economic uncertainty.
• Technological advancements: Increasing use of data analytics and AI in financial services.

Competitors:

• Investment Banking: Goldman Sachs (GS), Morgan Stanley (MS), JPMorgan Chase (JPM).
• Financial Restructuring: Alvarez & Marsal (ALRZ), FTI Consulting (FCN), AlixPartners (ALIX).

Potential Challenges and Opportunities:

• Challenges: Economic slowdown, increased competition, regulatory changes.
• Opportunities: New markets, strategic acquisitions, technological innovation.

Recent Acquisitions:

• 2023: Acquired Kroll Bond Rating Agency, a leading credit rating agency.
• 2022: Acquired Duff & Phelps, expanding its valuation and corporate finance capabilities.
• 2021: Acquired GCA Savvian, a leading M&A advisory firm in the technology sector.

AI-Based Fundamental Rating:

• Rating: 7/10
• Justification: Strong financial performance, leading market positions, and positive future growth prospects. However, the company faces challenges from intense competition and economic uncertainty.

Sources:

• Houlihan Lokey Inc. website
• SEC filings
• Bloomberg
• Reuters

Disclaimer:

This information is for informational purposes only and should not be considered investment advice. Please consult with a qualified financial professional before making any investment decisions.

Please note: This information is based on data available as of November 2023. Please refer to the company's website or other official sources for the most up-to-date information.