LPL Financial Holdings
Market Cap
US$7.3b
Last Updated
2020/11/23 23:43 UTC
Data Sources
Company Financials +
Executive Summary
LPL Financial Holdings Inc., together with its subsidiaries, provides an integrated platform of brokerage and investment advisory services to independent financial advisors and financial advisors at financial institutions in the United States. More Details
Rewards
Risk Analysis
Snowflake Analysis
Fair value with mediocre balance sheet.
Similar Companies
Share Price & News
How has LPL Financial Holdings's share price performed over time and what events caused price changes?
Latest Share Price and Events
Stable Share Price: LPLA is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 6% a week.
Volatility Over Time: LPLA's weekly volatility (6%) has been stable over the past year.
Market Performance
7 Day Return
0.8%
LPLA
1.2%
US Capital Markets
-0.06%
US Market
1 Year Return
0.4%
LPLA
9.0%
US Capital Markets
19.0%
US Market
Return vs Industry: LPLA underperformed the US Capital Markets industry which returned 9% over the past year.
Return vs Market: LPLA underperformed the US Market which returned 19% over the past year.
Shareholder returns
| LPLA | Industry | Market | |
|---|---|---|---|
| 7 Day | 0.8% | 1.2% | -0.06% |
| 30 Day | 10.6% | 6.7% | 4.4% |
| 90 Day | 12.7% | 8.4% | 6.3% |
| 1 Year | 1.8%0.4% | 11.7%9.0% | 21.7%19.0% |
| 3 Year | 92.8%84.9% | 32.0%21.8% | 46.4%36.7% |
| 5 Year | 122.0%100.2% | 79.3%56.8% | 91.0%69.9% |
Long-Term Price Volatility Vs. Market
How volatile is LPL Financial Holdings's share price compared to the market and industry in the last 5 years?
Simply Wall St News
2 weeks ago | Simply Wall St
Be Sure To Check Out LPL Financial Holdings Inc. (NASDAQ:LPLA) Before It Goes Ex-Dividend3 weeks ago | Simply Wall St
LPL Financial Holdings Inc. Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Predictions1 month ago | Simply Wall St
Is LPL Financial Holdings Inc. (NASDAQ:LPLA) A Smart Choice For Dividend Investors?Valuation
Is LPL Financial Holdings undervalued compared to its fair value and its price relative to the market?
9.4%
Undervalued compared to fair value
Share Price vs. Fair Value
Below Fair Value: LPLA ($92.03) is trading below our estimate of fair value ($101.56)
Significantly Below Fair Value: LPLA is trading below fair value, but not by a significant amount.
Price To Earnings Ratio
PE vs Industry: LPLA is good value based on its PE Ratio (15x) compared to the US Capital Markets industry average (22.6x).
PE vs Market: LPLA is good value based on its PE Ratio (15x) compared to the US market (19.5x).
Price to Earnings Growth Ratio
PEG Ratio: LPLA is poor value based on its PEG Ratio (4.7x)
Price to Book Ratio
PB vs Industry: LPLA is overvalued based on its PB Ratio (6x) compared to the US Capital Markets industry average (4.7x).
Next Steps
Future Growth
How is LPL Financial Holdings forecast to perform in the next 1 to 3 years based on estimates from 10 analysts?
3.2%
Forecasted annual earnings growth
Earnings and Revenue Growth Forecasts
Analyst Future Growth Forecasts
Earnings vs Savings Rate: LPLA's forecast earnings growth (3.2% per year) is above the savings rate (2.2%).
Earnings vs Market: LPLA's earnings (3.2% per year) are forecast to grow slower than the US market (21.9% per year).
High Growth Earnings: LPLA's earnings are forecast to grow, but not significantly.
Revenue vs Market: LPLA's revenue (4.8% per year) is forecast to grow slower than the US market (10.2% per year).
High Growth Revenue: LPLA's revenue (4.8% per year) is forecast to grow slower than 20% per year.
Earnings per Share Growth Forecasts
Future Return on Equity
Future ROE: LPLA's Return on Equity is forecast to be high in 3 years time (36.8%)
Next Steps
Past Performance
How has LPL Financial Holdings performed over the past 5 years?
28.2%
Historical annual earnings growth
Earnings and Revenue History
Quality Earnings: LPLA has high quality earnings.
Growing Profit Margin: LPLA's current net profit margins (8.5%) are lower than last year (10.1%).
Past Earnings Growth Analysis
Earnings Trend: LPLA's earnings have grown significantly by 28.2% per year over the past 5 years.
Accelerating Growth: LPLA's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.
Earnings vs Industry: LPLA had negative earnings growth (-11.9%) over the past year, making it difficult to compare to the Capital Markets industry average (3%).
Return on Equity
High ROE: Whilst LPLA's Return on Equity (40.4%) is outstanding, this metric is skewed due to their high level of debt.
Next Steps
Financial Health
How is LPL Financial Holdings's financial position?
Financial Position Analysis
Short Term Liabilities: LPLA's short term assets ($3.0B) exceed its short term liabilities ($1.0B).
Long Term Liabilities: LPLA's short term assets ($3.0B) do not cover its long term liabilities ($3.8B).
Debt to Equity History and Analysis
Debt Level: LPLA's debt to equity ratio (194.4%) is considered high.
Reducing Debt: LPLA's debt to equity ratio has increased from 178.4% to 194.4% over the past 5 years.
Debt Coverage: LPLA's debt is well covered by operating cash flow (24.6%).
Interest Coverage: LPLA's interest payments on its debt are well covered by EBIT (6.8x coverage).
Balance Sheet
Next Steps
Dividend
What is LPL Financial Holdings's current dividend yield, its reliability and sustainability?
1.09%
Current Dividend Yield
Dividend Yield vs Market
Notable Dividend: LPLA's dividend (1.09%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.5%).
High Dividend: LPLA's dividend (1.09%) is low compared to the top 25% of dividend payers in the US market (4.15%).
Stability and Growth of Payments
Stable Dividend: Whilst dividend payments have been stable, LPLA has been paying a dividend for less than 10 years.
Growing Dividend: LPLA's dividend payments have increased, but the company has only paid a dividend for 9 years.
Current Payout to Shareholders
Dividend Coverage: With its low payout ratio (16.3%), LPLA's dividend payments are well covered by earnings.
Future Payout to Shareholders
Future Dividend Coverage: LPLA's dividends in 3 years are forecast to be well covered by earnings (22.3% payout ratio).
Next Steps
Management
How experienced are the management team and are they aligned to shareholders interests?
4.3yrs
Average management tenure
CEO
Dan Arnold (56 yo)
3.83yrs
Tenure
US$7,669,954
Compensation
Mr. Dan Hogan Arnold serves as President and Chief Executive Officer of LPL Financial Holdings Inc. (“LPL”) (NASDAQ: LPLA). In this role, he sets the strategy and direction for the LPL with the Board, whil...
CEO Compensation Analysis
Compensation vs Market: Dan's total compensation ($USD7.67M) is about average for companies of similar size in the US market ($USD6.90M).
Compensation vs Earnings: Dan's compensation has been consistent with company performance over the past year.
Leadership Team
| Name | Position | Tenure | Compensation | Ownership |
|---|---|---|---|---|
| President | 3.83yrs | US$7.67m | 0.22% $ 15.8m | |
| Chief Financial Officer | 5.17yrs | US$3.32m | 0.0070% $ 511.8k | |
| MD & Chief Information Officer | 3.33yrs | US$2.78m | 0.018% $ 1.3m | |
| MD & Divisional President of Business Development | 2.25yrs | US$2.22m | 0.026% $ 1.9m | |
| MD & Chief Customer Care Officer | 1.75yrs | US$2.41m | 0.0044% $ 320.5k | |
| Executive Vice President of Operations | 0.58yr | no data | no data | |
| MD of Investor & Investment Solutions and Chief Investment Officer | 13.83yrs | US$2.16m | 0.031% $ 2.3m | |
| Senior Vice President of Investor Relations | 5.83yrs | no data | no data | |
| MD & Chief Legal Officer | 3.42yrs | US$1.84m | 0.018% $ 1.3m | |
| MD & Chief Human Capital Officer | 8.83yrs | US$1.11m | 0.017% $ 1.2m | |
| MD and Divisional President of National Sales & Consulting | 4.83yrs | no data | 0.039% $ 2.8m | |
| MD & Chief Risk Officer | 4.83yrs | US$2.41m | 0.0059% $ 430.7k |
4.3yrs
Average Tenure
55.5yo
Average Age
Experienced Management: LPLA's management team is considered experienced (4.3 years average tenure).
Board Members
| Name | Position | Tenure | Compensation | Ownership |
|---|---|---|---|---|
| President | 3.83yrs | US$7.67m | 0.22% $ 15.8m | |
| Independent Director | 15.08yrs | US$277.78k | 0.062% $ 4.5m | |
| Independent Director | 0.50yr | no data | 0.0063% $ 460.7k | |
| Independent Director | 3.5yrs | US$282.78k | 0.021% $ 1.5m | |
| Independent Director | 7.5yrs | US$292.78k | 0.038% $ 2.8m | |
| Independent Director | 6yrs | US$281.30k | 0.025% $ 1.9m | |
| Independent Non-Executive Chairman | 3.67yrs | US$388.59k | 0.17% $ 12.1m | |
| Independent Director | 1.5yrs | US$266.53k | 0.0094% $ 684.8k | |
| Independent Director | 2.42yrs | US$270.88k | 0.0053% $ 386.9k |
3.7yrs
Average Tenure
64yo
Average Age
Experienced Board: LPLA's board of directors are considered experienced (3.7 years average tenure).
Ownership
Who are the major shareholders and have insiders been buying or selling?
Insider Trading Volume
Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.
Recent Insider Transactions
Ownership Breakdown
Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.
Top Shareholders
Company Information
LPL Financial Holdings Inc.'s company bio, employee growth, exchange listings and data sources
Key Information
- Name: LPL Financial Holdings Inc.
- Ticker: LPLA
- Exchange: NasdaqGS
- Founded: 1989
- Industry: Investment Banking and Brokerage
- Sector: Diversified Financials
- Market Cap: US$7.300b
- Shares outstanding: 79.28m
- Website: https://www.lpl.com
Number of Employees
Location
- LPL Financial Holdings Inc.
- 4707 Executive Drive
- San Diego
- California
- 92121
- United States
Listings
| Ticker | Exchange | Primary Security | Security Type | Country | Currency | Listed on |
|---|---|---|---|---|---|---|
| LPLA | NasdaqGS (Nasdaq Global Select) | Yes | Common Stock | US | USD | Nov 2010 |
| 7LI | DB (Deutsche Boerse AG) | Yes | Common Stock | DE | EUR | Nov 2010 |
Biography
LPL Financial Holdings Inc., together with its subsidiaries, provides an integrated platform of brokerage and investment advisory services to independent financial advisors and financial advisors at financ...
Company Analysis and Financial Data Status
| Data | Last Updated (UTC time) |
|---|---|
| Company Analysis | 2020/11/23 23:43 |
| End of Day Share Price | 2020/11/23 00:00 |
| Earnings | 2020/09/30 |
| Annual Earnings | 2019/12/31 |
Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.