Lazard Earnings: Likely To Be Under Pressure for Several More Quarters

The bulk of Lazard is in a rough part of its business cycle, but the company has prepared to weather it, and there are signs of the very early stages of a recovery. In the second quarter, Lazard reported a net loss to common shareholders of $124 million, or $1.41 per diluted share, on $642 million of net revenue. It had $147 million of charges in the quarter related to cost-saving initiatives; pro forma net income was $23 million, or $0.24 per diluted share. Net revenue increased 1% from a year ago and 27% from the previous quarter; however, it was still 7% lower than the 2022 quarterly average and 19% lower than the 2021 quarterly average. We don’t anticipate making a material change to our $45 fair value estimate for narrow-moat-rated Lazard and assess the shares as modestly undervalued.