Lazard (LAZ) Stock Forecast & Price Target

Lazard Inc. has demonstrated a robust public pipeline, increasing by 8.2% compared to the end of the second quarter, in contrast to a 6.7% decline among peers, indicating strong growth potential. The firm is also experiencing positive deal sentiment, with year-over-year announcements increasing by 26% in Europe and 32% in the U.S. for the third quarter to date, reflecting improved market conditions. Furthermore, the acceleration in managing director hires positions Lazard favorably to meet or exceed its target of adding 10-15 net managing directors annually by 2025, suggesting ongoing expansion and strengthening of its advisory capabilities.

Lazard Inc. faces a negative outlook primarily due to a downside scenario where a stalled M&A recovery may lead to lower revenues and a higher compensation ratio, aligning the 2026 operating backdrop more closely with that of 2024. The recent decline of the "exceptionalism" trade, coupled with persistently elevated sentiment around international securities following years of underperformance, suggests challenges for its asset management segment, which is heavily equity-driven. Furthermore, despite potential structural tailwinds in the global equities market, the firm's financial standing remains vulnerable to broader economic conditions, negatively impacting its earnings potential.