Wells double upgrades Houlihan to Overweight Lokey on ‘defensibility’

Wells Fargo analyst Michael Brown double upgraded Houlihan Lokey (HLI) to Overweight from Underweight with a price target of $179, down from $180. The company’s “defensibility,” with upside from a recovery in mergers and acquisitions, is attractive during periods of uncertainty, the analyst tells investors in a research note. The firm says these are the times when Houlihan Lokey’s premium multiple is most warranted. While the stock’s valuation is still high, the strength of business model should be rewarded in times of market uncertainty, contends Wells. The firm says the outlook for Houlihan’s M&A business is brighter than peers given its focus on smaller deals and ability to continue to take share.