Lazard Reports Strong Q1 but Likely Downward Earnings Pressure Ahead; Shares Undervalued

Narrow-moat Lazard reported fairly strong first-quarter results, but the economic backdrop is becoming increasingly uncertain and there will likely be downward pressure over the next year or so. The company reported net income to common shareholders of $114 million, or $1.05 per diluted share, on $695 million of net revenue. Net revenue increased 5% from the previous year, but it was lower than the net revenue in the second, third, and fourth quarter of 2021. We don’t anticipate making a material change to our $51 fair value estimate for Lazard and assess shares are undervalued.