PIPR - Lazard downgraded PJT Partners upgraded at Wolfe on shifting M&A backdrop

Wolfe Research analyst Steven Chubak downgraded Lazard (NYSE:LAZ) to Underperform and upgraded PJT Partners (NYSE:PJT) to Outperform on Thursday, amid a backdrop of expected lower fees from M&A through 2023 for small to mid-sized brokers and independent M&A firms. Lazard (LAZ) stock is falling 1.5% in Thursday morning trading, while PJT (PJT) is off 0.2%. He lowered Wolfe's 2023 EPS estimates to reflect updated fee pool analysis, which implies an 8% annual decline in the M&A fee pool through 2023 due to weaker GDP growth. "We see negative revisions weighing on shares in the near term," Chubak wrote in a note to clients. Still, there are a wide range of potential outcomes. If the macroeconomic environment stabilizes, investment banking activity could recover quickly, "which would likely get these stocks working as our recent buy-side survey suggests sentiment is very poor." Thus, Chubak favors a bar-bell strategy. He prefers names with more emphasis on

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Lazard downgraded, PJT Partners upgraded at Wolfe on shifting M&A backdrop