While growth is established for NASDAQ:LPLA, the stock's valuation remains reasonable.

Last update: Jan 4, 2024

Here's LPL FINANCIAL HOLDINGS INC (NASDAQ:LPLA) for you, a growth stock our stock screener believes is undervalued. NASDAQ:LPLA is scoring impressively in terms of growth while demonstrating strong financials. On top of that, it remains attractively priced. Let's break it down further.

Analyzing Growth Metrics

ChartMill assigns a Growth Rating to every stock. This score ranges from 0 to 10 and evaluates the different growth aspects like EPS and Revenue, both in the past as in the future. NASDAQ:LPLA scores a 7 out of 10:

LPLA shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 83.02%, which is quite impressive.
Measured over the past years, LPLA shows a very strong growth in Earnings Per Share. The EPS has been growing by 34.19% on average per year.
LPLA shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 16.51%.
LPLA shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 14.97% yearly.
LPLA is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 13.75% yearly.
Based on estimates for the next years, LPLA will show a quite strong growth in Revenue. The Revenue will grow by 8.58% on average per year.

Assessing Valuation Metrics for NASDAQ:LPLA

To assess a stock's valuation, ChartMill utilizes a Valuation Rating on a scale of 0 to 10. This comprehensive assessment considers various valuation aspects, comparing price to earnings and cash flows, while factoring in profitability and growth. NASDAQ:LPLA has achieved a 5 out of 10:

Compared to an average S&P500 Price/Earnings ratio of 25.54, LPLA is valued a bit cheaper.
When comparing the Price/Forward Earnings ratio of LPLA to the average of the S&P500 Index (20.54), we can say LPLA is valued slightly cheaper.
84.16% of the companies in the same industry are more expensive than LPLA, based on the Enterprise Value to EBITDA ratio.
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
LPLA has an outstanding profitability rating, which may justify a higher PE ratio.
LPLA's earnings are expected to grow with 21.38% in the coming years. This may justify a more expensive valuation.

Health Analysis for NASDAQ:LPLA

ChartMill assigns a Health Rating to every stock. This score ranges from 0 to 10 and evaluates the different health aspects like liquidity and solvency, both absolutely, but also relative to the industry peers. NASDAQ:LPLA scores a 5 out of 10:

An Altman-Z score of 3.92 indicates that LPLA is not in any danger for bankruptcy at the moment.
LPLA's Altman-Z score of 3.92 is amongst the best of the industry. LPLA outperforms 80.69% of its industry peers.
With a decent Current ratio value of 1.77, LPLA is doing good in the industry, outperforming 64.36% of the companies in the same industry.
LPLA has a Quick ratio of 1.77. This is in the better half of the industry: LPLA outperforms 64.36% of its industry peers.

Understanding NASDAQ:LPLA's Profitability

ChartMill assigns a Profitability Rating to every stock. This score ranges from 0 to 10 and evaluates the different profitability ratios and margins, both absolutely, but also relative to the industry peers. NASDAQ:LPLA scores a 8 out of 10:

LPLA has a Return On Assets of 12.31%. This is amongst the best in the industry. LPLA outperforms 89.60% of its industry peers.
LPLA has a Return On Equity of 55.86%. This is amongst the best in the industry. LPLA outperforms 98.51% of its industry peers.
LPLA has a Return On Invested Capital of 20.13%. This is amongst the best in the industry. LPLA outperforms 95.54% of its industry peers.
LPLA had an Average Return On Invested Capital over the past 3 years of 13.63%. This is above the industry average of 9.76%.
The last Return On Invested Capital (20.13%) for LPLA is above the 3 year average (13.63%), which is a sign of increasing profitability.
In the last couple of years the Profit Margin of LPLA has grown nicely.
LPLA's Operating Margin has improved in the last couple of years.
LPLA has a Gross Margin of 98.98%. This is amongst the best in the industry. LPLA outperforms 97.52% of its industry peers.

Every day, new Affordable Growth stocks can be found on ChartMill in our Affordable Growth screener.

Check the latest full fundamental report of LPLA for a complete fundamental analysis.

Keep in mind

This article should in no way be interpreted as advice in any way. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.