Houlihan Lokey (HLI) Stock Analysis & Winston Score

Houlihan Lokey is an investment bank that helps companies with big financial decisions. Its main services are mergers and acquisitions (helping companies buy or sell other companies), restructuring (helping struggling companies manage their debt), and financial advisory work. It mostly serves mid-sized to large corporations, private equity firms, and governments around the world.

The company earns money by charging fees when deals are completed or when clients hire it for advice — there are no subscriptions or recurring product sales. Houlihan Lokey operates primarily in the United States but also has offices in Europe and Asia, and it generates roughly $2 billion in annual revenue. Its competitive edge comes from deep expertise in restructuring and mid-market deals, areas where it has built a strong reputation over decades. The key growth driver is deal activity across the broader economy, which means the business slows down significantly when interest rates are high or companies pull back on mergers and acquisitions.

Winston Score History

Politician Trades

7 trades / 12mo

3 Congressional buys and 4 sells on HLI in the last 12 months.

Unlock the full Smart Money Map — every trade plotted on the price chart with politicians, amounts and returns since each trade. Founder's Deal is $57/mo locked for life.

Unlock politician trades

Growth Profile

For growth stock investors

When traditional metrics don't capture the full picture, these are the signals growth stock investors use instead.

Revenue Growth

-4.6% YoY

YoY Growth Rate

Revenue declining

EPS Growth

-18.5% YoY

YoY Growth Rate

Earnings declining

R&D Spend

$0/ year

0.0% of revenue

Below sector average (7%)

Research and development spending

Insider Activity

0.1%ownership

→ Flat

Insiders holding steady — not selling despite ability to

Cash Position

Cash flow positive

$1.2B cash & investments

Quarterly Free Cash Flow

↑ Burn rate improving

Company generates more cash than it spends — no dilution risk from fundraising

Revenue declining

Houlihan Lokey's revenue is actually shrinking. In a growth stock, that removes the core investment thesis. The low Winston Score here may be warranted — unless there's a turnaround story.

The Winston Score above measures business quality today. Growth stocks often score lower because they invest in the future rather than maximising current profits. These metrics show what matters most for evaluating that future.

Share count broadly stable

+0.3% over 4y

The share count has stayed roughly flat over this period — little dilution or buyback activity.

Diluted shares outstanding: 68.3M (2022) → 68.4M (2026)

Score breakdown

Every number that matters to educated investors.

Each metric is explained in plain language so you know exactly what you're looking at. Start your free trial now.

Quality

Gross Margin

98.7%

Premium pricing power — 98.7% gross margin

Operating Margin

22.5%

Excellent — 22.5% operating margin

ROCE

6.1%

Weak — 6.1% return on capital

ROIC between 5% and 15%. They earn 5 to 15 cents back per year on every dollar invested.

Full breakdown available with your free trial

See every metric, trend, and what it means for this stock.

Try free

Growth

Sales YoY

+14.7%

Fast-growing sales (14.7% YoY)

EPS YoY

+20.7%

Earnings growing fast (20.7% YoY)

Healthy double-digit earnings growth — what compounders look like.

EPS Consistency

8/8 quarters

Every recent quarter grew earnings vs last year

Full breakdown available with your free trial

See every metric, trend, and what it means for this stock.

Try free

Cash Flow

Cash Conversion

150%

Turns 150% of profit into real cash

FCF Margin

24.5%

Converts sales into free cash efficiently (24.5%)

Free cash flow margin above 20%. Out of every $100 in sales, more than $20 is real cash they keep.

Full breakdown available with your free trial

See every metric, trend, and what it means for this stock.

Try free

Stability

Debt / Equity

N/A

Data not available

Interest Cover

100.00x

—

Comfortably covers interest (100.0x)

Interest coverage above 8. Profits cover interest many times over.

Full breakdown available with your free trial

See every metric, trend, and what it means for this stock.

Try free

Valuation

P/E Ratio (TTM)

20.7x

Growth-priced — P/E 20.7

P/E above the market average. People are paying up for expected growth.

P/E vs Forward

+3.6

GROWING

Earnings expected to grow meaningfully — cheaper on forward P/E (20.7 → 17.1)

Full breakdown available with your free trial

See every metric, trend, and what it means for this stock.

Try free

Dividends

Dividend Yield

1.78%

Small dividend — 1.78% yield

Modest yield. The bulk of any return needs to come from price appreciation.

Dividend Growth

+8.2%

Dividend growing modestly (8.2% YoY)

Full breakdown available with your free trial

See every metric, trend, and what it means for this stock.

Try free

🔒 See full fundamentals and if they are improving or declining — click here for your free trial now.

Start free trial