NASDAQ:LPLA stands out as a growth opportunity that won't break the bank.

Last update: Jan 26, 2024

Uncover the potential of LPL FINANCIAL HOLDINGS INC (NASDAQ:LPLA), a growth stock that our stock screener found to be reasonably priced. NASDAQ:LPLA is excelling in growth aspects, maintaining a healthy financial position, and still offers an attractive valuation. We'll examine each aspect in detail.

Understanding NASDAQ:LPLA's Growth Score

Every stock receives a Growth Rating from ChartMill, ranging from 0 to 10. This rating assesses various growth aspects, including historical and projected EPS and revenue growth. NASDAQ:LPLA boasts 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.
Looking at the last year, LPLA shows a quite strong growth in Revenue. The Revenue has grown by 16.51% in the last year.
The Revenue has been growing by 14.97% on average over the past years. This is quite good.
Based on estimates for the next years, LPLA will show a quite strong growth in Earnings Per Share. The EPS will grow by 13.75% on average per year.
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.

Deciphering NASDAQ:LPLA's Valuation Rating

ChartMill assigns a Valuation Rating to every stock. This score ranges from 0 to 10 and evaluates the different valuation aspects and compares the price to earnings and cash flows, while taking into account profitability and growth. NASDAQ:LPLA scores a 5 out of 10:

The average S&P500 Price/Earnings ratio is at 26.04. LPLA is valued slightly cheaper when compared to this.
LPLA is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 20.95, which is the current average of the S&P500 Index.
LPLA's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. LPLA is cheaper than 84.16% of the companies in the same industry.
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.

A Closer Look at Health for NASDAQ:LPLA

ChartMill employs a unique Health Rating system for all stocks. This rating, ranging from 0 to 10, is determined by analyzing various liquidity and solvency ratios. For NASDAQ:LPLA, the assigned 5 for health provides valuable insights:

An Altman-Z score of 3.96 indicates that LPLA is not in any danger for bankruptcy at the moment.
LPLA has a better Altman-Z score (3.96) than 80.20% of its industry peers.
Looking at the Current ratio, with a value of 1.77, LPLA is in the better half of the industry, outperforming 65.35% of the companies in the same industry.
LPLA has a better Quick ratio (1.77) than 65.35% of its industry peers.

Assessing Profitability for NASDAQ:LPLA

ChartMill's Profitability Rating offers a unique perspective on stock analysis, providing scores from 0 to 10. These ratings consider a wide range of profitability metrics and margins, both in comparison to industry peers and on their own merits. For NASDAQ:LPLA, the assigned 8 is a significant indicator of profitability:

With an excellent Return On Assets value of 12.31%, LPLA belongs to the best of the industry, outperforming 89.60% of the companies in the same industry.
LPLA's Return On Equity of 55.86% is amongst the best of the industry. LPLA outperforms 98.51% of its industry peers.
The Return On Invested Capital of LPLA (20.13%) is better than 95.54% of its industry peers.
The Average Return On Invested Capital over the past 3 years for LPLA is above the industry average of 9.79%.
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.
LPLA's Profit Margin has improved in the last couple of years.
In the last couple of years the Operating Margin of LPLA has grown nicely.
With an excellent Gross Margin value of 98.98%, LPLA belongs to the best of the industry, outperforming 97.52% of the companies in the same industry.

Our Affordable Growth screener lists more Affordable Growth stocks and is updated daily.

For an up to date full fundamental analysis you can check the fundamental report of LPLA

Disclaimer

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.