Lazard (LAZ) Stock Forecast & Price Target

Lazard Inc. has demonstrated a strong public pipeline performance, with an increase of 8.2% compared to the previous quarter, significantly outpacing the average decline of 6.7% observed among its peers. Additionally, recent data highlights a robust year-over-year growth in deal announcements, with the U.S. showing a 32% increase and Europe at 26%, indicating a positive trend in deal sentiment across both key markets. Moreover, the company's hiring of managing directors (MDs) has accelerated, suggesting a commitment to growth and a potential positive impact on its financial advisory services heading into 2025.

Lazard Inc. faces a challenging outlook due to the possibility of a stalled recovery in mergers and acquisitions (M&A), which could lead to lower revenues and an increased compensation ratio as the 2026 operating environment mirrors that of 2024. With the "Exceptionalism" trade diminishing since earlier in the year, the sentiment surrounding European and other international securities remains high after a prolonged period of underperformance, indicating a lack of momentum for potential growth. Furthermore, the reliance on equities as the primary driver of the asset management business, which constitutes over 80% of assets under management, raises concerns as the market may face structural challenges rather than a swift recovery.