Hamilton Lane (HLNE): Model Update

We are lowering our F2Q27 adjusted EPS forecast by $0.35 to $1.93, driven by lower FRPR and a delay in the close of the Russell transaction. Our forecast for F2Q27 FRPR declines from $25mn to $11.8mn, with returns generally positive but lackluster for seven of the twelve funds we track in the wealth channel that earn performance fees. Management fees remain unchanged at $165mn, up 1% Q/Q and 16% YoY. We now expect the Russell Investments acquisition to close in late CY26 or early CY27, pushing Russell gains to the next quarter, while modeling equity in income of investees at $56mn. We introduce FY28 estimates, including adjusted EPS of $7.67 and CY28 EPS of $8.33, and establish a Dec 2027 price target of $150, implying 18x our calendar 2028 estimate. We maintain our Overweight rating.