Lazard (NYSE:LAZ) Announces Earnings Results, Misses Estimates By $0.22 EPS

Lazard (NYSE:LAZ) released its quarterly earnings data on Thursday. The asset manager reported $0.12 earnings per share for the quarter, missing analysts’ consensus estimates of $0.34 by ($0.22), FiscalAI reports. The company had revenue of $786.02 million for the quarter, compared to analyst estimates of $736.29 million. Lazard had a return on equity of 23.58% and a net margin of 6.95%.The business’s quarterly revenue was up 1.5% on a year-over-year basis. During the same period last year, the firm posted $0.52 EPS.

Here are the key takeaways from Lazard’s conference call:

• Lazard reported firm-wide adjusted net revenue of $786 million in Q2 and $1.5 billion for the first half, with management saying the second half should be stronger than the first, especially in Financial Advisory.
• Financial Advisory momentum improved, with the best announced league table position since 2014, stronger conflict clearances, and a pipeline that management says is building faster than last year. The company also highlighted large transactions and continued strength in restructuring and private capital advisory.
• Asset Management had a strong first half, generating $7.4 billion of net inflows and reaching a record $285 billion in AUM, up 15% year over year. Management said client demand is broad-based across strategies and regions, and they remain on track for positive full-year net flows.
• Management said the Campbell Lutyens acquisition is on track to close later this year and should be accretive to earnings in 2027 and beyond, while expanding Lazard’s private capital advisory capabilities. They also said AI adoption is accelerating across the firm, but current AI spending remains modest.
• Q2 profitability was pressured by a 69.7% adjusted effective tax rate, which management called anomalous and linked to a catch-up adjustment on equity vesting. The company also kept compensation accruals elevated, so near-term margin improvement depends heavily on second-half revenue growth.

Lazard Price Performance

Shares of LAZ opened at $44.21 on Friday. The firm has a market capitalization of $4.94 billion, a price-to-earnings ratio of 21.67, a price-to-earnings-growth ratio of 0.64 and a beta of 1.43. The stock’s fifty day moving average is $44.24 and its 200-day moving average is $46.78. Lazard has a one year low of $38.67 and a one year high of $58.75. The company has a debt-to-equity ratio of 1.87, a quick ratio of 3.51 and a current ratio of 2.84.

Lazard Announces Dividend

The firm also recently declared a quarterly dividend, which will be paid on Friday, August 14th. Stockholders of record on Monday, August 3rd will be issued a dividend of $0.50 per share. This represents a $2.00 dividend on an annualized basis and a dividend yield of 4.5%. The ex-dividend date of this dividend is Monday, August 3rd. Lazard’s dividend payout ratio (DPR) is 79.05%.

Analyst Upgrades and Downgrades

LAZ has been the topic of several research reports. Keefe, Bruyette & Woods decreased their target price on Lazard from $44.00 to $42.00 and set a “market perform” rating on the stock in a research note on Friday. Citigroup reaffirmed a “market outperform” rating on shares of Lazard in a research note on Friday. UBS Group reiterated a “neutral” rating and set a $44.00 target price on shares of Lazard in a report on Tuesday, June 9th. Morgan Stanley set a $44.00 price target on shares of Lazard in a research note on Friday. Finally, Zacks Research raised shares of Lazard from a “strong sell” rating to a “hold” rating in a research report on Monday, July 6th. Four investment analysts have rated the stock with a Buy rating, five have assigned a Hold rating and two have given a Sell rating to the company. According to MarketBeat, the company has an average rating of “Hold” and a consensus target price of $50.38.

Key Headlines Impacting Lazard

Here are the key news stories impacting Lazard this week:

• Positive Sentiment: Lazard expanded its buyback plan while continuing to grow Asset Management revenue and assets under management, which supports the long-term capital return and earnings story. LAZ Stock Down as Q2 Earnings Lag on Higher Costs, Expands Buyback Plan
• Positive Sentiment: The company reiterated a long-term revenue target for Lazard Capital and outlined productivity goals, including higher revenue per managing director, suggesting management is focused on improving margins. Lazard targets $10m per MD by 2028 as it reiterates $500m Lazard CL 2027 revenue plan
• Neutral Sentiment: CEO Peter Orszag said AI should make future deal teams “leaner,” reinforcing the firm’s cost-efficiency push, but the impact on near-term results is still uncertain. Lazard CEO Orszag: AI will lead to ‘leaner’ deal teams with more MDs
• Neutral Sentiment: Lazard declared a quarterly dividend, which may appeal to income investors, but it is not a major fresh catalyst for the stock. Lazard earnings report and conference call
• Negative Sentiment: Q2 earnings missed expectations, with EPS of $0.12 versus estimates around $0.34-$0.42, reflecting pressure from weaker Financial Advisory revenue and higher expenses. Lazard (LAZ) Q2 Earnings Miss Estimates
• Negative Sentiment: Profit fell sharply year over year, with reports pointing to a 91% decline in quarterly profit due to a higher tax rate and volatility in the advisory business, which likely weighed on sentiment. Lazard profit plunges on elevated tax rate, financial advisory volatility
• Negative Sentiment: Keefe, Bruyette & Woods cut its price target on LAZ to $42 and kept a market-perform rating, signaling limited near-term upside. Benzinga report on Lazard price target cut

Institutional Trading of Lazard

A number of hedge funds and other institutional investors have recently made changes to their positions in LAZ. Price T Rowe Associates Inc. MD grew its stake in Lazard by 13.5% in the fourth quarter. Price T Rowe Associates Inc. MD now owns 8,807,320 shares of the asset manager’s stock valued at $427,685,000 after purchasing an additional 1,047,869 shares in the last quarter. Balyasny Asset Management L.P. acquired a new position in Lazard in the second quarter worth approximately $34,305,000. Alyeska Investment Group L.P. bought a new position in Lazard during the third quarter valued at approximately $18,201,000. Mackenzie Financial Corp lifted its stake in Lazard by 1,065.3% in the third quarter. Mackenzie Financial Corp now owns 347,564 shares of the asset manager’s stock valued at $18,334,000 after acquiring an additional 317,738 shares during the last quarter. Finally, Squarepoint Ops LLC acquired a new stake in shares of Lazard in the 4th quarter valued at $9,573,000. 54.80% of the stock is currently owned by institutional investors.

About Lazard

Lazard Ltd. (NYSE: LAZ) is a leading global financial advisory and asset management firm, offering a comprehensive suite of services to corporations, governments and individuals. Founded in 1848, Lazard has built a reputation for providing independent advice and innovative solutions in complex financial transactions. The firm is publicly traded on the New York Stock Exchange under the ticker symbol LAZ and maintains its headquarters in Hamilton, Bermuda.

In its Financial Advisory segment, Lazard assists clients with mergers and acquisitions, restructurings, capital structure optimization and strategic planning.