💥Mark Johnny to Market, Daily (Links #13)💥
Houlihan Lokey Inc. ($HLI), Buzzfeed Inc. ($BZFD), GoPro Inc. ($GPRO), Whatnot, BDC marks, US energy + more.
As we’ve mentioned more times than we can count, we always look forward to earnings from Houlihan Lokey Inc. ($HLI) because, unlike its competitors, it breaks out how the firm’s restructuring group is doing. On May 6, 2026, HLI reported its FY’26 and Q4’26 and while, as a whole, FY revenues fared comparatively well YOY, Q4 lagged on a YOY basis. The financial restructuring line-item(s) grabbed our attention.
For the three months ended March 31, 2026, HLI’s financial restructuring group hit ~$110.4mm, down meaningfully YOY from ~$164.5mm. For the fiscal year, the group logged ~$528.7mm, down from ~$544.5mm (or roughly 3%). Closed transactions fell from 38 to 30 in Q1 (down 21%) and from 145 to 143 during the fiscal year. The only thing up, it seems, was the number of Managing Directors sharing in the (relatively disappointing) performance (59 vs. 57 a year ago), 😬. Weight vests are all the rage these days but we’re guessing the prolific MDs in the group don’t exactly love carrying their dead weight “partners.”
So what’s going on here? In the earnings release, the firm said:
“Revenues decreased primarily due to a decrease in the average transaction fee on closed transactions and a decrease in the number of closed transactions. The lower average transaction fee on closed transactions resulted from transaction mix and does not represent a trend, while the reduction in transaction volume was driven by timing of transaction closings and does not represent a trend.”
Asked about restructuring, CEO Scott Adelson offered an improved outlook for FY’27 on the back of “some recent important wins” that indicate “elevated levels next year and probably beyond that as well.” When asked about the language about the lower average transaction fees and what management means when they talk about elevated levels, management be like:
Um, okay. Very informative, guys (especially on the heals of a disappointing report). The stock is down 14.4% YTD:
Now on to the Links….
🔗What We’re Reading (6 Reads)🔗
1. Buzzfeed Inc. ($BZFD)(Long Billionaires and their Toys). We asked:
It appears not! Because Byron Allen is coming to the rescue with what Bloomberg’s Matt Levine calls a “weird acquisition structure.” The stock popped on the news.
Allen will buy 40mm shares at $3/share for total of $120mm but only $20mm of that is cash. The remaining $100mm is a 5-year 5% promissory note. Upon closing (targeting end of this month), Allen will own 52%. Allen will also replace founder Jonah Peretti as Chair and CEO and Peretti will be the new head of AI. The Board of Directors also got reshuffled. You’ll recall that, in our prior coverage, we highlighted the following:
“In May ’25, the company borrowed $40mm from Sound Point on a first lien basis at S+650. In August ’25, the Company borrowed an incremental $5mm that was to be repaid in February ’26. Surprise, surprise, BuzzFeed has not repaid it, and has instead secured multiple short-term extensions. The incremental $5mm is now due April 30, 2026, and the Company owes an additional 200bps of interest until such time as it is repaid. The credit agreement also requires Buzzfeed to maintain minimum cash of $5mm and to repay a further a $15mm in August ’26.”
We look forward to seeing the use of proceeds here and how they flow through to Sound Point.
Notably, Freshfields LLP represented the company in the new deal while Latham & Watkins LLP represented Allen.
2. Cannabis (Long Recognition!). Weil Gotshal & Manges LLP hasn’t filed any — repeat ANY — chapter 11 bankruptcy cases in ‘26, but they sure are making the rounds, pounding their chests about some international shenanigans they’ve been orchestrating. You’ll recall from Links #9 …
… that Gary Holtzer and Sunny Singh be like:
Well, here we go again. This is a Bloomberg Law (“BL”) article, wherein the fine folks at Weil get a nice ego stroking; it discusses how Weil was able to gain US recognition of a Canadian foreign proceeding related to Cannabist, a company in the cannabis space, indirectly availing a cannabis company of the US courts. We covered the filing here:
Per BL:
“Chapter 15, which governs foreign proceedings, had been an untapped option for cannabis businesses until now, partly because companies were hesitant to pursue bankruptcy, said David J. Cohen, a partner at Weil, Gotshal & Manges LLP who serves as counsel for Cannabist’s foreign representative in the US case. Businesses also must qualify for foreign insolvency proceedings before seeking US recognition.
‘Combined with some regulatory changes that probably provided enough impetus, at least in these circumstances, the facts made it make sense to pursue this path,” Cohen said. “It’s not going to be the right path for every company, but for those who have a cross-border element, it’s certainly a good alternative.’
The British Columbia-based company has nonbankrupt subsidiaries that operate marijuana retail businesses in the US. Delaware bankruptcy judge Brendan L. Shannon signed the recognition order May 9.”
But here’s the choice bit:
“Cannabist had the trifecta: Canadian holding companies, debt issued under Canadian law, and a Canadian insolvency proceeding that has been tested in the US.
‘This has created a road map for other Canadian-based cannabis companies to use,’ said Jason Rosell, leader of Pachulski Stang Ziehl & Jones’ cannabis restructuring group. ‘The problem is that it’s likely limited from a practical perspective to a few companies.’
Other companies, however, may try to pursue a creative plan to establish Canadian operations and then seek Chapter 15 recognition, he said.”
The US Trustee did not object. This gave us a chuckle:
“For some bankruptcy observers, the US Trustee’s lack of a firm position on the Cannabist case came as a surprise.
‘We certainly understood that the US Trustee might object, but we also could foresee a situation in which they wouldn’t,’ Cohen said.”
LOL, nice stratechery there brah.
Client: “So, David, will this strategy lead to significant resistance from the US Trustee?”
David Cohen:
Followed by:
3. GoPro Inc. ($GPRO)(Long Strategic M&A?). People may actually want to buy this 💩 now that it’s trying to sell the world on defense and aerospace applications. We wrote about the company just a week ago but and now the company had indicated that “multiple unsolicited inquiries” have come in about a possible sale or merger. The stock initially popped 10% after hours on the report before people recovered from their momentary lapse of reason, remembered the company still sucks a$$, and the stock fell right on back down to earth.
4. Liveshopping (Long Addictive Commerce). Here is a Bloomberg piece about an app called Whatnot, a popular platform that empowers social livestream shopping. Is this model part of the digital future that QVC seeks to pursue once it emerges from chapter 11?
5. Private Prices (Short Daily Marks). Here is an FT piece about Pimco strategist Lotfi Karoui’s steaming dump on Apollo Global Management’s (“Apollo”) suggestion that it would, starting in September, report daily valuations for nearly its entire private credit portfolio. Here’s the choice bit:
“Daily pricing is not only an incomplete answer to these issues — it may even exacerbate them. Daily pricing is not price discovery. At best, it adds marginal transparency and some reputational pressure that may rein in the most extreme mark outliers. But on its own, it is not a meaningful structural reform of the private credit market.
Any manager can produce a daily price estimate using an imputation model based on discount rates, comparable spreads, and borrower-level credit metrics. But that is simply a higher-frequency application of the same Level 3 valuation process that already produces wide dispersion in quarterly BDC marks.
The same loan can be marked five or even 10 points apart because managers are not anchoring valuations to the same inputs, and, more importantly, because no one is required to transact at the stated price. If three BDCs rely on different model inputs on a quarterly basis, they will do so daily as well. The result would be dispersion at a higher frequency, potentially with more noise, not less. The core problem, therefore, is not frequency. It is methodology and observability.”
Whatever Apollo decides to do, make sure to pay attention to the footnotes:
6. US Energy Production (Long New Records). According to the US Energy Information Administration, the United States set a new record for energy production in ‘25, hitting 107 quadrillion British thermal units (quads), a 2.4% increase from the previous record set way back in … ‘24. As this chart 👇 reflects, the US produced record numbers in natural gas, crude oil, natural gas plant liquids (NGPLs), and renewables:
📼What We’re Watching📼
We’re not sure what’s more terrifying: algorithmic bots or physical robots. For all of the recent talk about the former, the latter seems to be making great strides recently too.
📚Resources📚
We have compiled a list of a$$-kicking resources on the topics of restructuring, tech, finance, investing, and disruption. 💥You can find it here💥.