HLI Should I Buy
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HLI is not a strong buy right now for a beginner long-term investor with $50,000-$100,000 available. The company’s latest quarter shows solid fundamental growth, but the current setup is mixed: technical momentum is weak, hedge funds are net sellers, analyst targets are being cut, and there is no bullish proprietary signal. Pre-market trading is near support, but based on the data provided, the stock is better suited for holding/watchlist status than an immediate aggressive buy.
The current pre-market price is 154.36, which is just above S1 at 154.315 and below the pivot at 158.706. That places the stock near short-term support but still below the key resistance zone. MACD histogram is -0.104 and negatively expanding, which signals weakening momentum. RSI_6 at 35.013 is neutral but leaning weak, and the moving averages are converging, suggesting a lack of clear trend strength. Overall, the chart points to a soft/sideways-to-bearish near-term setup rather than a strong breakout pattern. The model-based trend estimate also suggests small near-term weakness, despite a better 1-month outlook.
["Latest quarter financials were strong: revenue rose 13.03% YoY, net income rose 22.29% YoY, and EPS rose 22.30% YoY in Q3 2026.", "Longer-term M&A backdrop remains constructive according to Goldman Sachs, which noted the cycle is still in the middle stages relative to the 2023 trough.", "Options positioning is bullish, with a very low put-call ratio and call-heavy activity.", "The stock is trading near support in pre-market, which could offer a reasonable entry point if momentum turns."]
["Hedge funds are selling, and the selling amount increased 102.34% over the last quarter.", "Analyst price targets have been cut across multiple firms, including Morgan Stanley, Keefe Bruyette, UBS, and Goldman Sachs.", "Morgan Stanley expects cautious optimism but warns that comp ratios could disappoint amid uncertainty in the revenue environment.", "Technical momentum is weak: MACD is negative and expanding, and the stock is below the pivot level.", "No recent news catalyst was provided for the past week.", "No recent congress trading data and no influential insider/politician buying signal were provided."]
In Q3 2026, Houlihan Lokey delivered solid growth. Revenue increased to $717.1M, up 13.03% YoY, net income rose to $116.5M, up 22.29% YoY, and EPS increased to $1.70, up 22.30% YoY. This is a healthy latest-quarter result and supports the long-term business case, especially for a beginner investor looking for quality earnings growth.
Recent analyst sentiment is mixed but leaning more cautious on valuation expectations. Morgan Stanley kept an Overweight rating but lowered its target to $193 from $205. Keefe Bruyette cut its target to $177 from $214 while maintaining Outperform. UBS lowered its target to $163 from $196 and stayed Neutral. Goldman Sachs remained Buy but reduced its target to $210 from $243. Overall, Wall Street still sees upside potential, but the trend in price targets is clearly downward, showing pros remain constructive on the business while acknowledging lower near-term expectations.
