Lazard Gains 19% in 3 Months: Should You Buy the Stock Now?

Lazard Ltd. LAZ shares have gained 19% in the past three months, outperforming the industry’s growth of 7.4%. Shares of its peers, Franklin Resources BEN and Invesco Ltd. IVZ, have risen 12.7% and 38.5%, respectively, in the same time frame.

Three Months Price Performance

With the recent strength in the LAZ share price, many investors must be wondering whether to add stock to their portfolio now or not. To answer this, let us delve deeper and analyze its investment worthiness.

What's Supporting LAZ's Performance?

Solid Revenue Growth: The organic growth remains a key strength for Lazard. Over the past four years ended 2024, revenues witnessed a compound annual growth rate (CAGR) of 7.9%. This momentum continued into the first half of 2025, fueled by growth in financial advisory revenues and a diversified asset management mix.

Looking ahead, the expected resurgence in global deal-making activity in the second half of 2025, coupled with the firm’s strategic alliance with Arini Capital Management to expand access to private capital solutions across Europe, is poised to support top-line growth. Management is targeting to double revenues by 2030 while delivering an average annual shareholder return of 10–15%.

Revenue Growth Trend

Asset Management Expansion: Lazard has steadily broadened its asset management platform in recent years. Although the LAZ’s AUM balance declined in 2022 and the first half of 2025, the balance witnessed a CAGR of 1.7% over the last eight years ending in 2024. As of July 31, 2025, preliminary AUM stood at $253.7 billion, up 3.1% from prior year’s quarter, supported by net inflows and market appreciation.

Strategic initiatives have further strengthened this growth trajectory. The company completed the acquisition of Truvvo Partners in 2023, adding $3.8 billion in AUM. In 2024, LAZ also completed its initial investment in a partnership with Elaia Partners in Paris, which introduced a new asset management service focused on private market solutions in the technology sector. These initiatives complement the firm’s public market offerings, ensuring a diversified AUM base that can drive sustainable revenue growth. 

Cost-Management Initiatives: The company has been focused on restoring its historical profitability range through disciplined cost management. Although the company witnessed an increase in non-compensation expenses in 2021 and 2023, it declined in 2020, 2022, and 2024. In addition, the metric continued to decrease in the first half of 2025. Lazard is also reducing its workforce, targeting a compensation ratio of 60% or below and a non-compensation ratio between 16% and 20% in the near term. These cost-containment measures are expected to reduce expenses and improve margins in the upcoming period.

Superior Return on Equity: Lazard’s trailing 12-month return on equity (ROE) underscores its efficient use of shareholder capital. The firm reported an ROE of 34.33%, significantly higher than the industry average of 8.73%. This superior profitability metric reflects strong operational efficiency and enhances investor confidence in the stock.

How to Approach LAZ Stock Now?

Lazard’s solid revenue growth, asset management expansion, and cost containment efforts position it well for long-term growth. Also, the company’s earnings are projected to grow 7.69% in 2025 and 54.10% in 2026.

The company’s earnings estimates for 2025 and 2026 have been revised upward over the past week. This upward adjustment reflects a positive sentiment among analysts and suggests encouraging prospects.

Estimate Revision Trend

Further, LAZ is currently trading at a forward 12-month price-to-earnings (P/E) multiple of 15.85X, lower than the industry’s P/E of 20.56X. Its peers, Franklin and Invesco, trade at a P/E multiple of 10.55X and 10.11X, respectively.

Price-to-Earnings F12M

With its attractive valuation, solid fundamentals, and upward estimate revisions, Lazard presents an appealing investment opportunity. Investors may consider adding stock to their portfolio to generate healthy long-term returns.

The company currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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