Diamond Hill Investment Group (DHIL) AI Stock Analysis

• Market Cap: $464.97M
• Dividend Yield: 3.38%
• Average Volume (3M): 41.44K
• Price to Earnings (P/E): 10.0
• Beta (1Y): 0.62
• Revenue Growth: 7.47%
• EPS Growth: -2.12%
• Country: US
• Employees: 127
• Sector: Financial
• Sector Strength: 70
• Industry: Asset Management
• EPS (TTM): 3.41
• Shares Outstanding: 2,705,580
• 10 Day Avg. Volume: 71,630
• 30 Day Avg. Volume: 41,442
• PEG Ratio: <0.01
• Price to Book (P/B): <0.01
• Price to Sales (P/S): 0.00314
• P/FCF Ratio: -0.05
• Enterprise Value/Market Cap: -76.48
• Enterprise Value/Revenue: -0.24
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 74 Outperform
• Price Target: $192.00 ▲(12.86% Upside)
• Action: Reiterated Date: 02/27/26
• Date: Action: Reiterated 02/27/26

The score is driven primarily by strong profitability and a conservative balance sheet, supported by attractive valuation (low P/E and meaningful dividend). Offsetting these positives are materially weaker and recently negative cash flows, plus merger-related uncertainty and legal/disclosure overhang; technically, the uptrend is constructive but looks overbought.

Positive Factors

High and consistent profitability / ROE

Consistently high net margins and mid-20%+ ROE indicate durable earnings power from investment management fees. This sustained profitability supports reinvestment, dividend capacity and client servicing even if AUM fluctuates, strengthening long-term franchise economics.

Conservative balance sheet with low leverage

Very low leverage provides financial flexibility to absorb AUM swings, fund integration costs from strategic transactions, and maintain operations without stressing solvency. A conservative capital structure reduces bankruptcy and refinancing risk over the medium term.

Scale and diversified AUM mix across strategies

Material AUM and a mix of large-cap equity and fixed-income strategies broaden revenue sources and distribution channels. Scale supports institutional relationships and product shelf strength, making fee revenue less reliant on any single strategy or client segment over time.

Negative Factors

Weakening operating and free cash flow

A swing to negative operating and free cash flow undermines the cash-backed quality of reported profits and limits flexibility for dividends, retention incentives, or transaction-related costs. Persistently weak cash conversion raises financing and liquidity risks during integration.

Volatile revenue and top-line visibility

Intermittent revenue and AUM swings reduce predictability of fee income and make operating leverage outcomes less stable. For an asset manager, uneven flows impair planning, pressure margins in weaker periods, and heighten client-retention sensitivity.

Merger execution risk and legal/disclosure overhang

Active litigation and disclosure demands increase closing uncertainty, potential costs, and distraction for management. Client consents and shareholder approval are required for the deal; sustained legal overhang could delay integration and create retention or revenue continuity risks.

Diamond Hill Investment Group Business Overview & Revenue Model

Company Description

Diamond Hill Investment Group, Inc., through its subsidiary, Diamond Hill Capital Management, Inc., provides investment advisory and fund administration services in the United States. It sponsors, distributes, and offers investment advisory and related services to its clients through pooled investment vehicles, including the Diamond Hill Funds, separately managed accounts, and model delivery programs. The company also provides fund administration services, including portfolio and regulatory compliance, treasury and financial oversight, and general business management and governance of the mutual fund complex, as well as oversight of back-office service providers, such as the custodian, fund accountant, and transfer agent. The company was founded in 1990 and is based in Columbus, Ohio.

How the Company Makes Money

Diamond Hill generates revenue primarily through management fees charged on assets under management (AUM). These fees are calculated as a percentage of the AUM in their mutual funds and separate accounts. Additionally, the company may earn performance fees based on the returns generated by its investment strategies exceeding a specified benchmark. Key revenue streams include fees from institutional clients, retail mutual fund investors, and separate account management. The firm's reputation for disciplined investment strategies and its ability to attract and retain a significant client base are crucial factors contributing to its earnings, alongside any strategic partnerships with financial advisors and institutions that help to expand its reach in the market.

Diamond Hill Investment Group Financial Statement Overview

Summary

Strong profitability and an exceptionally low-leverage balance sheet support fundamentals, but cash-flow quality is a key concern: operating/free cash flow weakened in 2024 and turned negative in 2025, and the latest income statement trends appear anomalous, reducing confidence in near-term durability.

Income Statement

Profitability is a clear strength, with consistently high net margins (roughly high-20s to low-40s from 2020–2024) and solid operating profitability across the period. Revenue growth has been volatile—strong in 2021, declines in 2022–2023, then modest growth in 2024—suggesting earnings power is good but top-line visibility is not perfectly steady. The 2025 annual figures appear anomalous (extreme revenue growth and margin inconsistencies), which reduces confidence in the latest trend signal.

Balance Sheet

The balance sheet looks conservatively positioned: debt is low relative to equity across the years provided (near-zero in 2020–2022 and still very low in 2023–2025), indicating limited leverage risk. Returns on equity are strong and relatively consistent (generally mid-20%+ with a peak around 2021), pointing to efficient capital use. The main watch item is the step-up in absolute debt in the most recent periods versus earlier years, albeit still modest versus equity.

Cash Flow

Cash generation was healthy in 2020–2023 with operating cash flow generally tracking net income well and free cash flow near net income. However, 2024 shows weaker cash conversion (operating cash flow materially below net income), and 2025 annual cash flow turns negative (both operating and free cash flow), which is a meaningful red flag for near-term cash quality and sustainability. Given the sharp swing, cash flow looks less stable than reported profitability.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	147.10B	151.10M	136.72M	154.50M	182.19M
Gross Profit	0.00	68.19M	57.12M	85.10M	97.94M
EBITDA	1.19B	45.12M	36.79M	65.71M	77.54M
Net Income	48.76B	43.18M	42.23M	40.43M	74.20M
Balance Sheet
Total Assets	260.40B	245.13M	232.09M	249.82M	286.15M
Cash, Cash Equivalents and Short-Term Investments	42.42B	41.62M	46.99M	63.20M	80.55M
Total Debt	6.40B	6.34M	768.92K	0.00	0.00
Total Liabilities	83.97B	82.56M	71.78M	72.02M	83.97M
Stockholders Equity	176.43B	162.32M	160.32M	163.67M	184.42M
Cash Flow
Free Cash Flow	-9.05B	15.24M	34.65M	39.38M	25.21M
Operating Cash Flow	-6.62B	16.60M	34.67M	39.48M	26.31M
Investing Cash Flow	32.75B	30.51M	-4.21M	6.03M	27.26M
Financing Cash Flow	-25.33B	-52.48M	-46.67M	-62.87M	-71.50M

Diamond Hill Investment Group Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 170.12
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Negative
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DHIL, the sentiment is Positive. The current price of 170.12 is below the 20-day moving average (MA) of 171.11, below the 50-day MA of 170.47, and above the 200-day MA of 142.91, indicating a bullish trend. The MACD of 1.14 indicates Positive momentum. The RSI at 70.55 is Negative, neither overbought nor oversold. The STOCH value of 58.24 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DHIL.

Diamond Hill Investment Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DHIL	74 Outperform	$464.97M	9.97	26.98%	3.38%	7.47%	-2.12%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
SCM	60 Neutral	$290.05M	9.20	8.20%	12.83%	90.34%	-44.25%
PNNT	59 Neutral	$325.17M	12.70	5.38%	16.61%	-3.09%	200.66%
TSLX	59 Neutral	$1.64B	9.56	10.61%	9.64%	-6.44%	-1.18%
VRTS	56 Neutral	$934.54M	6.93	15.07%	5.41%	-3.07%	18.00%
PSBD	52 Neutral	$324.47M	23.94	2.72%	14.10%	-2.38%	-75.49%

Diamond Hill Investment Group Corporate Events

Diamond Hill Grants Retention Award to Chief Financial Officer

Diamond Hill Investment Group, Inc. entered into a merger agreement on December 10, 2025, under which Soar Christopher Holdings, Inc., a subsidiary of First Eagle Investment Management, will merge with Diamond Hill, leaving Diamond Hill as a wholly owned subsidiary of First Eagle. The transaction is expected to close in the second quarter of 2026, subject to customary conditions, including shareholder approval and required client consents.

On February 20, 2026, in anticipation of changes to the company’s compensation structure following the merger, the board’s Compensation Committee approved a deferred cash-based award for Chief Financial Officer and Treasurer Thomas E. Line. The award provides a one-time $100,000 cash payment if he remains employed through February 20, 2027, or if he is terminated without cause or resigns for good reason before that date, contingent on signing a separation and release agreement, underscoring efforts to retain key leadership during the integration period.

The most recent analyst rating on (DHIL) stock is a Buy with a $191.00 price target. To see the full list of analyst forecasts on Diamond Hill Investment Group stock, see the DHIL Stock Forecast page.

Diamond Hill Issues Supplemental Disclosures on First Eagle Merger

Diamond Hill Investment Group has filed a definitive proxy statement for a March 3, 2026 special shareholder meeting to vote on its previously announced merger with First Eagle Investment Management, under a December 10, 2025 agreement that would see Diamond Hill become a wholly owned First Eagle subsidiary if required shareholder and client consent conditions are met. As of early February 2026, two shareholder lawsuits and multiple demand letters challenged the adequacy of Diamond Hill’s proxy disclosures and sought to block the deal, prompting the company—while denying all allegations—to issue voluntary supplemental financial and transaction-related disclosures, including expanded projections, valuation analyses and clarification that no pre-signing assurances of continued employment were given to senior management.

The most recent analyst rating on (DHIL) stock is a Buy with a $191.00 price target. To see the full list of analyst forecasts on Diamond Hill Investment Group stock, see the DHIL Stock Forecast page.

Diamond Hill Gains Key Antitrust Clearance for First Eagle Merger

On February 10, 2026, Diamond Hill Investment Group and acquirer First Eagle Investment Management received early termination of the Hart-Scott-Rodino Act waiting period from the U.S. Federal Trade Commission in connection with their planned merger first announced on December 10, 2025. This regulatory milestone, disclosed in a February 17, 2026 press release, satisfies a key antitrust condition and clears a major hurdle toward closing the deal.

With HSR clearance secured, the companies now expect the transaction to close in the second quarter of 2026, subject to remaining customary conditions, including shareholder approval and requisite client consents based on revenue run-rate. Diamond Hill has scheduled a special shareholder meeting for March 3, 2026 to vote on the merger, a step that will help determine whether the asset manager proceeds to become a wholly owned subsidiary of First Eagle, reshaping its ownership structure while maintaining operational continuity for clients.

The most recent analyst rating on (DHIL) stock is a Buy with a $191.00 price target. To see the full list of analyst forecasts on Diamond Hill Investment Group stock, see the DHIL Stock Forecast page.

Diamond Hill reports $28.7 billion in assets under management

As of January 31, 2026, Diamond Hill Capital Management reported total assets under management of $28.7 billion, with $18.2 billion in proprietary funds, $4.9 billion in separately managed accounts, $1.8 billion in collective investment trusts, and $3.8 billion in other pooled vehicles. The firm’s assets are heavily concentrated in U.S. equity strategies, particularly Large Cap, which accounted for $13.4 billion, while fixed income and securitized strategies such as Short Duration Securitized Bond ($5.2 billion) and Core Fixed Income ($3.8 billion) represented a significant portion of its diversified product mix, underscoring the company’s scale and positioning across both equity and fixed income markets.

The most recent analyst rating on (DHIL) stock is a Buy with a $191.00 price target. To see the full list of analyst forecasts on Diamond Hill Investment Group stock, see the DHIL Stock Forecast page.

Diamond Hill Grants CFO Retention Bonus Amid Merger

On December 10, 2025, Diamond Hill Investment Group, Inc. agreed to be acquired by First Eagle Investment Management, LLC through a merger in which a First Eagle subsidiary will be merged into Diamond Hill, leaving Diamond Hill as a wholly owned subsidiary of First Eagle, with closing targeted by the third quarter of 2026 subject to shareholder, client consent, and regulatory approvals. On January 28, 2026, to support continuity of leadership and operations through the merger process and post-closing integration, Diamond Hill’s board compensation committee granted Chief Financial Officer Thomas E. Line a $500,000 cash retention bonus, vesting in two equal installments at closing and six months thereafter, with accelerated payment if he is terminated without cause or resigns for good reason before those dates.

The most recent analyst rating on (DHIL) stock is a Buy with a $191.00 price target. To see the full list of analyst forecasts on Diamond Hill Investment Group stock, see the DHIL Stock Forecast page.

Diamond Hill Reports $29.4 Billion in Assets Under Management

As of December 31, 2025, Diamond Hill Capital Management reported total assets under management of $29.4 billion, with $18.8 billion in proprietary funds, $5.1 billion in separately managed accounts, $1.7 billion in collective investment trusts, and $3.7 billion in other pooled vehicles. The firm’s assets were diversified across multiple strategies, led by Large Cap equity at $14.4 billion and Core Fixed Income and Short Duration Securitized Bond strategies at $3.7 billion and $5.1 billion respectively, indicating a substantial presence in both equity and fixed income markets and underscoring its positioning as a multi-asset manager serving a variety of institutional and retail clients.

The most recent analyst rating on (DHIL) stock is a Buy with a $192.00 price target. To see the full list of analyst forecasts on Diamond Hill Investment Group stock, see the DHIL Stock Forecast page.

Diamond Hill Announces Merger with First Eagle

On December 10, 2025, Diamond Hill Investment Group entered into a merger agreement with First Eagle Investment Management, where Diamond Hill will become a wholly owned subsidiary of First Eagle. The merger will involve a cash transaction for Diamond Hill’s common stock at $175 per share, and the board of directors has unanimously approved the merger, recommending shareholder approval. The merger is expected to be financed through First Eagle’s cash on hand and existing credit facilities, with no financing condition attached to the merger’s completion. The agreement includes provisions for the treatment of equity awards and executive severance agreements, and outlines conditions for closing, including shareholder approval and regulatory clearances. The merger is anticipated to enhance Diamond Hill’s market position and align its operations with First Eagle’s strategic objectives.

The most recent analyst rating on (DHIL) stock is a Hold with a $124.00 price target. To see the full list of analyst forecasts on Diamond Hill Investment Group stock, see the DHIL Stock Forecast page.

Diamond Hill Reports $29.624 Billion in AUM

As of November 30, 2025, Diamond Hill Capital Management, Inc. reported a total of $29.624 billion in assets under management. The assets are diversified across various investment strategies, with significant allocations in large cap and short duration securitized bond strategies, indicating a strong market presence in these areas.

The most recent analyst rating on (DHIL) stock is a Hold with a $139.00 price target. To see the full list of analyst forecasts on Diamond Hill Investment Group stock, see the DHIL Stock Forecast page.