LPL FINANCIAL HOLDINGS INC (LPLA) Stock Fundamental Analysis
NASDAQ:LPLA - Nasdaq - US50212V1008 - Common Stock - Currency: USD
Overall LPLA gets a fundamental rating of 5 out of 10. We evaluated LPLA against 225 industry peers in the Capital Markets industry. LPLA has an average financial health and profitability rating. LPLA is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
LPLA had positive earnings in the past year.
LPLA had a positive operating cash flow in the past year.
LPLA had positive earnings in each of the past 5 years.
LPLA had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
LPLA's Return On Assets of 8.42% is amongst the best of the industry. LPLA outperforms 84.02% of its industry peers.
LPLA has a Return On Equity of 36.27%. This is amongst the best in the industry. LPLA outperforms 97.72% of its industry peers.
LPLA has a Return On Invested Capital of 13.91%. This is amongst the best in the industry. LPLA outperforms 91.32% of its industry peers.
The Average Return On Invested Capital over the past 3 years for LPLA is significantly above the industry average of 6.76%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.42% | ||
| ROE | 36.27% | ||
| ROIC | 13.91% |
ROA(3y)9.04%
ROA(5y)8.01%
ROE(3y)42.14%
ROE(5y)37.98%
ROIC(3y)15.38%
ROIC(5y)14%
1.3 Margins
With a Profit Margin value of 8.73%, LPLA is not doing good in the industry: 63.01% of the companies in the same industry are doing better.
LPLA's Profit Margin has declined in the last couple of years.
LPLA has a Operating Margin of 14.23%. This is in the lower half of the industry: LPLA underperforms 65.30% of its industry peers.
LPLA's Operating Margin has declined in the last couple of years.
LPLA has a better Gross Margin (98.97%) than 99.09% of its industry peers.
LPLA's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 14.23% | ||
| PM (TTM) | 8.73% | ||
| GM | 98.97% |
OM growth 3Y10.2%
OM growth 5Y-2.12%
PM growth 3Y12.79%
PM growth 5Y-3%
GM growth 3Y0.03%
GM growth 5Y0.02%
2. Health
2.1 Basic Checks
The number of shares outstanding for LPLA remains at a similar level compared to 1 year ago.
LPLA has less shares outstanding than it did 5 years ago.
The debt/assets ratio for LPLA is higher compared to a year ago.
2.2 Solvency
LPLA has an Altman-Z score of 4.16. This indicates that LPLA is financially healthy and has little risk of bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 4.16, LPLA belongs to the top of the industry, outperforming 82.19% of the companies in the same industry.
The Debt to FCF ratio of LPLA is 47.37, which is on the high side as it means it would take LPLA, 47.37 years of fcf income to pay off all of its debts.
LPLA has a Debt to FCF ratio (47.37) which is comparable to the rest of the industry.
LPLA has a Debt/Equity ratio of 1.64. This is a high value indicating a heavy dependency on external financing.
The Debt to Equity ratio of LPLA (1.64) is worse than 73.97% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.64 | ||
| Debt/FCF | 47.37 | ||
| Altman-Z | 4.16 |
ROIC/WACCN/A
WACCN/A
2.3 Liquidity
LPLA has a Current Ratio of 2.04. This indicates that LPLA is financially healthy and has no problem in meeting its short term obligations.
LPLA's Current ratio of 2.04 is fine compared to the rest of the industry. LPLA outperforms 68.04% of its industry peers.
LPLA has a Quick Ratio of 2.04. This indicates that LPLA is financially healthy and has no problem in meeting its short term obligations.
Looking at the Quick ratio, with a value of 2.04, LPLA is in the better half of the industry, outperforming 68.04% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.04 | ||
| Quick Ratio | 2.04 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 5.23% over the past year.
LPLA shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 18.07% yearly.
LPLA shows a strong growth in Revenue. In the last year, the Revenue has grown by 23.20%.
Measured over the past years, LPLA shows a quite strong growth in Revenue. The Revenue has been growing by 17.10% on average per year.
EPS 1Y (TTM)5.23%
EPS 3Y32.96%
EPS 5Y18.07%
EPS Q2Q%21.08%
Revenue 1Y (TTM)23.2%
Revenue growth 3Y17.06%
Revenue growth 5Y17.1%
Sales Q2Q%32.84%
3.2 Future
Based on estimates for the next years, LPLA will show a quite strong growth in Earnings Per Share. The EPS will grow by 11.23% on average per year.
LPLA is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 8.25% yearly.
EPS Next Y23.48%
EPS Next 2Y21.61%
EPS Next 3Y21.48%
EPS Next 5Y11.23%
Revenue Next Year23.29%
Revenue Next 2Y17.83%
Revenue Next 3Y16.02%
Revenue Next 5Y8.25%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 22.55, the valuation of LPLA can be described as rather expensive.
Compared to the rest of the industry, the Price/Earnings ratio of LPLA indicates a slightly more expensive valuation: LPLA is more expensive than 60.73% of the companies listed in the same industry.
The average S&P500 Price/Earnings ratio is at 29.63. LPLA is valued slightly cheaper when compared to this.
Based on the Price/Forward Earnings ratio of 18.26, the valuation of LPLA can be described as rather expensive.
LPLA's Price/Forward Earnings ratio is in line with the industry average.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.68, LPLA is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.55 | ||
| Fwd PE | 18.26 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, LPLA is valued cheaper than 80.37% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, LPLA is valued a bit more expensive than 61.64% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 289.46 | ||
| EV/EBITDA | 14.69 |
4.3 Compensation for Growth
LPLA's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
The decent profitability rating of LPLA may justify a higher PE ratio.
LPLA's earnings are expected to grow with 21.48% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.96
PEG (5Y)1.25
EPS Next 2Y21.61%
EPS Next 3Y21.48%
5. Dividend
5.1 Amount
With a yearly dividend of 0.32%, LPLA is not a good candidate for dividend investing.
LPLA's Dividend Yield is slightly below the industry average, which is at 10.00.
With a Dividend Yield of 0.32, LPLA pays less dividend than the S&P500 average, which is at 2.29.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.32% |
5.2 History
The dividend of LPLA has a limited annual growth rate of 3.46%.
LPLA has been paying a dividend for at least 10 years, so it has a reliable track record.
LPLA has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)3.46%
Div Incr Years1
Div Non Decr Years11
5.3 Sustainability
LPLA pays out 8.94% of its income as dividend. This is a sustainable payout ratio.
LPLA's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP8.94%
EPS Next 2Y21.61%
EPS Next 3Y21.48%
372.13
-7.33 (-1.93%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryCapital Markets
Earnings (Last)
Earnings (Next)
Inst Owners96.75%
Inst Owner Change-0.23%
Ins Owners0.52%
Ins Owner Change-0.09%
Market Cap27.78B
Analysts82.61
Price Target425.73 (14.4%)
Short Float %0.89%
Short Ratio1.22
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.32% |
Yearly Dividend1.2
Dividend Growth(5Y)3.46%
DP8.94%
Div Incr Years1
Div Non Decr Years11
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)6.32%
Min EPS beat(2)2.73%
Max EPS beat(2)9.9%
EPS beat(4)4
Avg EPS beat(4)5.71%
Min EPS beat(4)1.79%
Max EPS beat(4)9.9%
EPS beat(8)7
Avg EPS beat(8)3.74%
EPS beat(12)11
Avg EPS beat(12)5.17%
EPS beat(16)15
Avg EPS beat(16)6.34%
Revenue beat(2)0
Avg Revenue beat(2)-0.63%
Min Revenue beat(2)-0.88%
Max Revenue beat(2)-0.38%
Revenue beat(4)2
Avg Revenue beat(4)0.54%
Min Revenue beat(4)-0.88%
Max Revenue beat(4)2.56%
Revenue beat(8)3
Avg Revenue beat(8)-0.1%
Revenue beat(12)6
Avg Revenue beat(12)1.63%
Revenue beat(16)10
Avg Revenue beat(16)2.6%
PT rev (1m)15.28%
PT rev (3m)40.99%
EPS NQ rev (1m)-0.72%
EPS NQ rev (3m)-1.64%
EPS NY rev (1m)4.77%
EPS NY rev (3m)6.99%
Revenue NQ rev (1m)1.62%
Revenue NQ rev (3m)2.42%
Revenue NY rev (1m)3.57%
Revenue NY rev (3m)4.8%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.55 | ||
| Fwd PE | 18.26 | ||
| P/S | 2.41 | ||
| P/FCF | 289.46 | ||
| P/OCF | 46.39 | ||
| P/B | 10.02 | ||
| P/tB | 229.36 | ||
| EV/EBITDA | 14.69 |
EPS(TTM)16.5
EY4.43%
EPS(NY)20.37
Fwd EY5.48%
FCF(TTM)1.29
FCFY0.35%
OCF(TTM)8.02
OCFY2.16%
SpS154.25
BVpS37.12
TBVpS1.62
PEG (NY)0.96
PEG (5Y)1.25
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.42% | ||
| ROE | 36.27% | ||
| ROCE | 18.58% | ||
| ROIC | 13.91% | ||
| ROICexc | 20.58% | ||
| ROICexgc | 60.54% | ||
| OM | 14.23% | ||
| PM (TTM) | 8.73% | ||
| GM | 98.97% | ||
| FCFM | 0.83% |
ROA(3y)9.04%
ROA(5y)8.01%
ROE(3y)42.14%
ROE(5y)37.98%
ROIC(3y)15.38%
ROIC(5y)14%
ROICexc(3y)25.69%
ROICexc(5y)23.2%
ROICexgc(3y)601.16%
ROICexgc(5y)439.94%
ROCE(3y)20.53%
ROCE(5y)18.7%
ROICexcg growth 3Y-17.5%
ROICexcg growth 5Y-21.77%
ROICexc growth 3Y-2.43%
ROICexc growth 5Y-7.38%
OM growth 3Y10.2%
OM growth 5Y-2.12%
PM growth 3Y12.79%
PM growth 5Y-3%
GM growth 3Y0.03%
GM growth 5Y0.02%
F-Score5
Asset Turnover0.96
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.64 | ||
| Debt/FCF | 47.37 | ||
| Debt/EBITDA | 2.22 | ||
| Cap/Depr | 123.98% | ||
| Cap/Sales | 4.37% | ||
| Interest Coverage | 7.49 | ||
| Cash Conversion | 29.3% | ||
| Profit Quality | 9.55% | ||
| Current Ratio | 2.04 | ||
| Quick Ratio | 2.04 | ||
| Altman-Z | 4.16 |
F-Score5
WACCN/A
ROIC/WACCN/A
Cap/Depr(3y)N/A
Cap/Depr(5y)N/A
Cap/Sales(3y)N/A
Cap/Sales(5y)N/A
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)5.23%
EPS 3Y32.96%
EPS 5Y18.07%
EPS Q2Q%21.08%
EPS Next Y23.48%
EPS Next 2Y21.61%
EPS Next 3Y21.48%
EPS Next 5Y11.23%
Revenue 1Y (TTM)23.2%
Revenue growth 3Y17.06%
Revenue growth 5Y17.1%
Sales Q2Q%32.84%
Revenue Next Year23.29%
Revenue Next 2Y17.83%
Revenue Next 3Y16.02%
Revenue Next 5Y8.25%
EBIT growth 1Y-6.88%
EBIT growth 3Y29%
EBIT growth 5Y14.62%
EBIT Next Year34.18%
EBIT Next 3Y20.11%
EBIT Next 5Y12.55%
FCF growth 1Y153.83%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y209.5%
OCF growth 3YN/A
OCF growth 5YN/A