HLI NYSE Russell 1000 Earnings call
Houlihan Lokey (HLI) · Q2 2026 results and valuation
Share price: $146.17 · 2026-11-11
Results Q2 2026 vs Q1 2026 · previous quarter · fiscal Q1 2027 · published 29 Jul 2026 and 6 May 2026
Net income down 20.5% on the previous quarter. Management sounded restrained, in its script and in answers to analysts.
Only a basic analysis is available for this company at the moment.
1 · Numbers
−20.5%
Net income vs Q1 2026
Outlook given
Net income 78.0M vs 98.1M
Revenue −19.6%
Against the same quarter last year (Q2 2025) it is −20.4%, so it is not just seasonal.
2 · How management spoke
Restrained
Less upbeat than 78% of company calls
Answers to analysts: restrained, in line with the script.
Similar to last call.
3 · What stood out
Figure
Corporate Finance revenues fell 24% to $303 million this quarter compared to the same period last year.
Valuation
Is Houlihan Lokey undervalued?
Reverse DCF. Free cash flow from the last full fiscal year (2026-03-31), grown for 10 years, discounted back, plus a terminal value. “Implied growth” is the rate the current price assumes.
At 13.1% growth a year (3-year revenue growth), the model's fair value is $305.09 a share — the stock trades 52% below it. Today's price assumes 2.6% growth a year.
Current price
$146.17
close of 2026-11-11
Market implies growth of iThe yearly free-cash-flow growth, for the next 10 years, that today’s share price already assumes. If you believe the company grows faster than this, the stock is cheap under this model; slower, and it is expensive.
+2.6% for 10 yrs
Fair value / share
$305.09
Buy below
$228.82
Price vs fair value
Undervalued 52%
Price vs buy-below price
Undervalued 36%
Read between the lines
-
Key theme
Compensation costs are expected to stay at 61.5% for fiscal 2027.
Source quote
“However, our average transaction fee on closed deals decreased significantly. We closed 127 transactions this quarter basically flat with the same period last year. As Scott mentioned, deal time lines have extended and disproportionately affected our larger fee deals in the first quarter.”
-
Guidance
Tax rate for fiscal 2027 is expected to be 26% to 28%.
Source quote
“We expect to see a fiscal 2027 full year adjusted effective tax rate of between 26% and 28%.”
Tone
How upbeat the language was, compared with other companiesiTone counts positive minus negative finance words, adjusted for length. Executives mostly speak positively, so the labels compare each call with every company's latest call: “typical” is the middle third, “very upbeat” the top tenth, “cautious” the bottom tenth.. Dot: Q2 2026. Ring: Q1 2026.
Script and answers carried a similar tone, so the script's message held up under questioning.
Sentences that drove the tone
“Financial and Valuation Advisory produced a strong quarter with growth across all 3 service lines, underscoring the general health of the economy and FVA's balanced business model across industry and...”
“For the full fiscal year, we expect to see our non-compensation expense growth similar to last year's growth.”
“Headwinds that started in February and March persisted into April and May, as deal momentum slowed, specifically in consumer-facing sectors that are particularly sensitive to inflation and consumer sentiment and...”
Full figures
USD · SEC EDGAR XBRL (10-Q, period end 2026-06-30)
| Metric | Q2 2026period end 2026-06-30 | Q1 2026period end 2026-03-31 | Change | Q2 2025 | YoY |
|---|---|---|---|---|---|
| Revenue | 511.0M | 635.6M | −19.6% | 605.0M | −15.5% |
| Gross profit | 154.0M | — | 188.0M | −18.1% | |
| Operating income | 78.0M | 125.1M | −37.7% | 90.0M | −13.3% |
| Net income | 78.0M | 98.1M | −20.5% | 98.0M | −20.4% |
| EPS | 1.15 | 1.48 | −22.3% | 1.42 | −19.0% |
| P/E today 21.3 | 22.5 | 23.1 | −0.6 | 30.3 | −7.8 |
Topics
Most discussed now
- New Headwinds that started in February and March persisted into April and May, as deal momentum slowed, specifically in consumer-facing…
- Financial Restructuring revenues were $119 million for the quarter, generally in line with Houlihan Lokey's expectations.
- A lot of those market share gains are just the larger mid-cap firms like Houlihan Lokey taking market share away...
- Given sort of the success of the Houlihan and some of Houlihan Lokey's larger middle market peers, it is becoming structurally...
Faded since Q1 2026
- Dropped Delivering these results against the backdrop of significant geopolitical uncertainty and macroeconomic pressures underscores the strength…
- Dropped While the growth in Houlihan Lokey's fourth quarter results in CF and FDA were impacted by recent external market disruptions, including...
- Fading Since Houlihan Lokey went public 10 years ago, it has reported annual revenue growth in 9 of the 10 years.
- Fading Just overall, if you look at sponsor activity, before really the conflict started what Houlihan Lokey had said was it had...
Latest announcements
Official filings, newest first.
- Director or officer change · SEC 8-K
- Director or officer change; Shareholder vote results; Regulation FD disclosure · SEC 8-K
- Director or officer change · SEC 8-K
- Other events · SEC 8-K
- Results of operations · SEC 8-K
- Results of operations · SEC 8-K
- Other events · SEC 8-K
- Director or officer change · SEC 8-K