Joe Friday

Why I'm Exiting Greenhill & Co.

The existing shareholders are wise to sell. Anyone that will give them 76 dollars for their shares should have their head examined. This is probably among the most overvalued stocks on the market today.

Greenhill's Skill of Lifting Talent Is Golden

At 50x trailing eps, GHL is trading at bubble levels. Note that their earnings are not,for the most part, predicitable or recurring but rather will always depend on the vagaries of their advisory business. The one recurring reveneue stream they have is their capital management business which generates income from the management of a series of partnerships. All of those partnerhships have lockup periods that will start to come to an end in the next year or so...Given the poor performance of all of these funds, one would expect redemptions from most investors at the first opportunity.
The book value of the company is approximatley 6 dollars a share.
At 12x book and 50x eps I would not be long GHL.
for a more detailed analysis see seekingalpha.com/artic...

S&P Downgrades Investment Bank for Being Too Good at Investment Banking

I suspect that S & P may have been referring to the requirement that only entities that have managed 10B can participate in the public private partnerships to buy up the "toxic" assets. GHL does not meet that criteria, and cannot therefore participate in that program.
As to GHL itself, it is overvalued on any possible metric. See my previous post for backup. Note that it is thinly traded and has a high short interest.
seekingalpha.com/artic...