Houlihan Lokey (HLI) has appointed Dan Buffery as a Managing Director in its Capital Solutions Group, focusing on North American GP led secondaries advisory, a hire that draws attention to the stock’s recent performance.

Buffery’s arrival comes as Houlihan Lokey’s shares have lost momentum, with the 90 day share price return down 10.53% and the year to date share price return down 23.83%. The 5 year total shareholder return of 83.04% still reflects a much stronger longer term outcome.

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After a sharp share price pullback, Houlihan Lokey now sits at a level where past long term returns and current expectations are pulling in opposite directions. So how does the current valuation stack up for new buyers versus holders?

Most Popular Narrative: 22.1% Undervalued

Compared with Houlihan Lokey's last close at $134.31, the most followed narrative points to a fair value closer to $172.50, built on detailed revenue and earnings forecasts.

Increasing global corporate complexity and cross-border transactions are driving ongoing demand for independent advisory expertise, as evidenced by resilient revenues and continued international hiring and expansion initiatives. These factors are expected to support sustained top-line revenue growth.

Want to understand why this story points to higher value for Houlihan Lokey? The narrative leans on steady revenue expansion, firm margins, and a richer earnings multiple. Curious which specific growth path and profitability profile are baked into that outlook? The full narrative sets out the numbers behind that fair value case in plain language.

Result: Fair Value of $172.50 (UNDERVALUED)

However, Houlihan Lokey’s reliance on US focused M&A activity and its relatively high cost base could pressure both revenue growth and margins if deal pipelines soften.

Next Steps

If the mix of optimism and caution around Houlihan Lokey leaves you undecided, take a moment to review the underlying data and then act promptly to shape your own view with the 5 key rewards.

Looking for more investment ideas beyond Houlihan Lokey?

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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.