By Rebecca Ungarino

A string of earnings reports this month have showed that a rising tide of dealmaking activity over the past year has generally helped lift big banks' bottom lines. Wall Street analysts don't expect the same performance in Lazard's results, due out Thursday.

Analysts expect the bank to report net income of $48 million on a U.S. GAAP basis, a 25% drop from a year earlier. On an adjusted basis, analysts polled by FactSet expect profit of $58 million, or a decline of 11% from adjusted results in the year-ago period.

Wall Street forecast a 2% decline in financial advisory revenue from a year ago and flat revenue from asset management. During a financial industry conference in December, Lazard Chief Executive Officer Peter Orszag said "inflows will balance outflows" in the asset management business in 2025 before "tilting towards net positive flows over time."

"The way we think about this is, just like 2024 was a transition and an inflection point on the advisory side, we are organizing ourselves for 2025 to be an inflection point on the asset side of the business," he said.

The market has treated Orszag's tenure kindly. Since the veteran banker and former Obama administration official was named CEO in October 2023, replacing former CEO Ken Jacobs, the stock has risen 70%, outperforming the broader market's 40% rise.

Lazard shares hit an record high following Election Day in the U.S. in November, when investors rewarded the financial sector after President Donald Trump's win. The stock has fallen 14% since its record on Nov. 6, though, while the S&P 500 has advanced 2% in that time.

JMP Securities analysts wrote in a recent note to clients that while the firm's asset management arm "has represented a drag on firmwide growth, and also investor sentiment, we believe the valuation is more than reflecting this view already."

The analysts, who have a Market Outperform rating on Lazard's stock, said that management has "committed itself to driving a sharp normalization in operating margins, which should significantly improve the company's profitability profile."

Here were Wall Street analysts' expectations for Lazard's fourth-quarter results on a U.S. GAAP basis, according to FactSet, compared with what the company reported for the fourth quarter of 2023.

Net income of $48 million vs. $64 million

Earnings per share of 46 cents vs. 65 cents

Operating revenue of $749 million vs. $761 million

Financial advisory revenue of $468 million vs. $477 million

Asset management revenue of $273 million vs. $274 million

Write to Rebecca Ungarino at rebecca.ungarino@barrons.com

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

January 29, 2025 18:13 ET (23:13 GMT)

Copyright (c) 2025 Dow Jones & Company, Inc.