Is HLI a Buy? What to Consider in 2026
Last updated July 2026
Short answer
The bull case for Houlihan Lokey (HLI) rests on Restructuring ballast: Houlihan Lokey runs one of the largest restructuring advisory practices in the world, consistently ranked in the top tier alongside PJT Partners and Evercore. Revenue (FY2026, ended Mar 2026) is ~$2.62B. If you believe that thesis holds, the real questions become position sizing and overlap, not timing. The main risk to that view: Advisory revenue is inherently lumpy and tied to deal completions, so a prolonged M&A slowdown or credit freeze can pressure results even with the restructuring hedge. Whether HLI is a buy comes down to whether you believe the thesis. This is informational, not a recommendation, and Walnut is not an investment adviser.
Houlihan Lokey, Inc. (NYSE: HLI) is an independent, advisory-focused investment bank founded in 1972 and headquartered in Los Angeles. It advises corporations, private equity sponsors, and governments across three segments: Corporate Finance (M&A and capital-raising, the largest slice at roughly two-thirds of revenue), Financial Restructuring (out-of-court workouts and bankruptcy advisory, where it is a global market leader by deal volume), and Financial and Valuation Advisory (fairness opinions, portfolio valuation, and financial consulting). Unlike bulge-bracket banks, Houlihan Lokey does not trade for its own account or make large loans, so its revenue is almost entirely advisory fees. The investment picture centers on the counter-cyclical balance between its businesses. When mergers and financings are strong, Corporate Finance drives growth; when credit tightens and defaults rise, the restructuring practice picks up, smoothing results across cycles. For fiscal 2026 (ended March 31, 2026) the firm reported revenue of roughly $2.62 billion, up about 10 percent, with net income near $426 million and diluted EPS around $6.22. The stock carries a growing dividend and a mid-cap valuation that has historically commanded a premium to deal-dependent peers because of the restructuring ballast and the capital-light, fee-based model.
What's the case for buying HLI?
1. Restructuring ballast
Houlihan Lokey runs one of the largest restructuring advisory practices in the world, consistently ranked in the top tier alongside PJT Partners and Evercore. That business tends to accelerate exactly when M&A slows, giving the firm a natural hedge that most advisory banks lack.
2. M&A and capital-markets recovery
Corporate Finance is the biggest revenue driver, and a rebound in dealmaking and sponsor-driven activity flows directly to fees. Fiscal 2026 revenue rose about 10 percent to roughly $2.62 billion as deal conditions improved, and continued normalization in private-equity activity would extend that.
3. Capital-light, fee-based model
The firm earns advisory fees rather than trading or lending, so it carries little balance-sheet risk and converts revenue to cash efficiently. That supports a rising dividend (raised about 17 percent to $0.70 per quarter in May 2026) plus buybacks.
4. Scale and diversification through acquisition
Houlihan Lokey has built breadth across sectors, geographies, and product lines partly through tuck-in acquisitions, expanding its valuation and consulting franchise and deepening industry coverage that helps it win mid-market and larger mandates.
What are the risks to HLI?
Advisory revenue is inherently lumpy and tied to deal completions, so a prolonged M&A slowdown or credit freeze can pressure results even with the restructuring hedge. The business depends heavily on retaining senior bankers, and competition for talent is intense against boutiques and bulge brackets alike. Fees can swing quarter to quarter based on the timing of transaction closings, making near-term earnings hard to forecast. The stock has traded at a premium multiple, which leaves less room for error if growth disappoints. Regulatory scrutiny of large restructurings and M&A, plus macro shocks to capital markets, are additional external factors outside the firm's control.
How is HLI valued? (as of July 2026)
Snapshot for HLI as of July 2026, sourced from Yahoo Finance and may be delayed. Valuation figures move with price and earnings; verify the current numbers with your broker before deciding.
- Revenue (FY2026, ended Mar 2026): ~$2.62B
- Net income (FY2026): ~$426M
- Diluted EPS (FY2026): ~$6.22
- Adjusted EPS (FY2026): ~$7.56
- Market cap: ~$11.4B
- P/E (TTM): ~22x
At roughly $137 per share in mid-July 2026, HLI trades near a market cap of about $11.4 billion, with a trailing P/E around 22x that sits below its multi-year median. The dividend was raised about 17 percent to $0.70 per quarter (roughly $2.80 annualized). The 52-week range has been wide (roughly $131 to $212), reflecting the market's shifting expectations for deal activity.
How do you decide if HLI is a buy?
Rather than asking whether HLI is a buy in the abstract, it tends to help to answer four questions:
- Thesis: do you believe the case above, and is it still true today?
- Time horizon: a single stock can be volatile, so a longer horizon absorbs more of the swings.
- Position sizing: a thesis can be right and the sizing still wrong; decide how much of your portfolio one name should be.
- Overlap: check whether you already hold HLI indirectly through an index or sector ETF before adding more.
For the full picture, see the HLI stock guide (what the company does, the ETFs that hold it, similar stocks, and the themes it fits). In Walnut you can ask its AI about HLI against your real portfolio and see your actual exposure before deciding.
The bottom line on HLI
The bottom line: Houlihan Lokey's story right now is Restructuring ballast, with revenue (fy2026, ended mar 2026) at ~$2.62B. If you believe that narrative continues, the call is about sizing HLI sensibly and checking overlap with what you own; if you doubt it (the risk: advisory revenue is inherently lumpy and tied to deal completions, so a prolonged M&A slowdown or credit freeze can pressure results even with the restructuring hedge.), it is not for you. Decide from the thesis, not the ticker. Walnut is not an investment adviser.
Build a basket around HLI with Walnut
Use Houlihan Lokey as one constituent in a thematic basket Walnut's AI helps you assemble. Describe a thesis you believe in, the AI proposes the holdings and weights, and you approve before any broker order.
FAQ
Is HLI a good stock to buy right now?
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The case for Houlihan Lokey right now is Restructuring ballast, with revenue (fy2026, ended mar 2026) at ~$2.62B. If you believe that thesis holds, HLI is a way to own it and the real questions are sizing and overlap, not timing; the main risk to that view is advisory revenue is inherently lumpy and tied to deal completions, so a prolonged M&A slowdown or credit freeze can pressure results even with the restructuring hedge. So it comes down to whether you believe the thesis. Walnut is not an investment adviser and this is not a recommendation.
What does Houlihan Lokey do?
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Houlihan Lokey, Inc.
What are the main risks of HLI?
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Advisory revenue is inherently lumpy and tied to deal completions, so a prolonged M&A slowdown or credit freeze can pressure results even with the restructuring hedge. The business depends heavily on retaining senior bankers, and competition for talent is intense against boutiques and bulge brackets alike. Fees can swing quarter to quarter based on the timing of transaction closings, making near-term earnings hard to forecast. The stock has traded at a premium multiple, which leaves less room for error if growth disappoints. Regulatory scrutiny of large restructurings and M&A, plus macro shocks to capital markets, are additional external factors outside the firm's control.
What does Houlihan Lokey do?
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It is an independent global investment bank that provides advisory services: mergers and acquisitions advice, capital raising, financial restructuring for distressed companies and creditors, and valuation and financial opinions. It earns fees for advice rather than trading or lending.
What are HLI's business segments?
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Three: Corporate Finance (M&A and capital solutions, the largest), Financial Restructuring (bankruptcy and workout advisory), and Financial and Valuation Advisory (fairness opinions, portfolio valuation, and consulting). Corporate Finance is roughly two-thirds of revenue.
How did Houlihan Lokey perform in fiscal 2026?
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For the fiscal year ended March 31, 2026, revenue was roughly $2.62 billion, up about 10 percent from the prior year, with net income near $426 million and diluted EPS around $6.22 (adjusted EPS about $7.56).
Does HLI pay a dividend?
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Yes. In May 2026 the firm raised its quarterly dividend about 17 percent to $0.70 per share, or roughly $2.80 annualized, giving a yield in the ballpark of 2 percent at recent prices. It also repurchases shares.
Walnut is informational and is not an investment adviser. This page is educational and not a recommendation to buy or sell HLI; figures are approximate and dated, and your own situation, time horizon, and risk tolerance should drive any decision. Verify current data before investing.