In a report released on April 25, Ryan Kenny from Morgan Stanley maintained a Sell rating on Lazard (LAZ – Research Report), with a price target of $33.00.
Ryan Kenny has given his Sell rating due to a combination of factors impacting Lazard’s financial outlook. Despite Lazard’s solid earnings performance in the first quarter of 2025, driven by a favorable tax release and better-than-expected compensation ratios, the forward outlook remains uncertain. The company’s stock underperformed as concerns about the future compensation ratio persist, which is a critical factor for investors.
Furthermore, while Lazard experienced a revenue beat and an increase in backlog due to European activity and restructuring, the outlook for the compensation ratio is heavily dependent on revenue growth. Lazard anticipates a mid-single-digit increase in salary and amortization expenses for the fiscal year 2025. Although there are potential tailwinds from cross-border M&A activities, the elevated backlog and market volatility could delay funding times, adding to the uncertainty. These factors contribute to the cautious stance reflected in the Sell rating.
LAZ’s price has also changed moderately for the past six months – from $51.120 to $38.640, which is a -24.41% drop .