Houlihan Lokey Data Shows Small Private Credit Defaults Surge Tenfold Since 2023
HLI sits 21% above its 52-week low of $112.83 on light trading volume (0.4× avg).
Summary
Houlihan Lokey's Q2 2026 Private Credit DataBank reveals a sharp rise in stress among the smallest private credit borrowers, with default rates climbing more than tenfold since 2023. Defaults among borrowers with less than $100M EBITDA hit 3.0% size-weighted and 3.6% by count, while the overall market remains below 1% size-weighted. The report also shows 7% of all loans priced below 90% of par, more than double the historical average, and 12% of loans to $10-20M EBITDA borrowers below that threshold, up from roughly 1% in 2023. This follows Houlihan Lokey's Q1 revenue miss and a recent CFO stock purchase, adding a negative data point on the private credit market the firm serves. The findings could pressure sentiment around HLI's restructuring and valuation advisory revenue if credit stress persists.
At the time of this announcement, HLI was trading at $136.70 on NYSE in the Finance sector, with a market capitalization of approximately $9.6B. The 52-week trading range was $112.83 to $211.78. This news item was assessed with negative market sentiment and an importance score of 7 out of 10. Source: BusinessWire.