LPL FINANCIAL HOLDINGS INC (LPLA) Stock Fundamental Analysis
NASDAQ:LPLA - Nasdaq - US50212V1008 - Common Stock
Taking everything into account, LPLA scores 6 out of 10 in our fundamental rating. LPLA was compared to 224 industry peers in the Capital Markets industry. While LPLA has a great profitability rating, there are some minor concerns on its financial health. While showing a medium growth rate, LPLA is valued expensive at the moment.
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 each of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 8.42%, LPLA belongs to the top of the industry, outperforming 84.47% of the companies in the same industry.
LPLA's Return On Equity of 36.27% is amongst the best of the industry. LPLA outperforms 98.17% of its industry peers.
Looking at the Return On Invested Capital, with a value of 13.92%, LPLA belongs to the top of the industry, outperforming 91.32% of the companies in the same industry.
LPLA had an Average Return On Invested Capital over the past 3 years of 14.97%. This is significantly above the industry average of 6.66%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.42% | ||
| ROE | 36.27% | ||
| ROIC | 13.92% |
ROA(3y)8.31%
ROA(5y)8.33%
ROE(3y)39.28%
ROE(5y)41.69%
ROIC(3y)14.97%
ROIC(5y)14.71%
1.3 Margins
With a Profit Margin value of 8.73%, LPLA is not doing good in the industry: 63.47% of the companies in the same industry are doing better.
In the last couple of years the Profit Margin of LPLA has grown nicely.
Looking at the Operating Margin, with a value of 14.23%, LPLA is doing worse than 66.21% of the companies in the same industry.
LPLA's Operating Margin has improved in the last couple of years.
LPLA's Gross Margin of 98.97% is amongst the best of the industry. LPLA outperforms 99.09% of its industry peers.
In the last couple of years the Gross Margin of LPLA has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 14.23% | ||
| PM (TTM) | 8.73% | ||
| GM | 98.97% |
OM growth 3Y9.68%
OM growth 5Y3.52%
PM growth 3Y9.63%
PM growth 5Y4.6%
GM growth 3Y0.05%
GM growth 5Y0.03%
2. Health
2.1 Basic Checks
Compared to 1 year ago, LPLA has less shares outstanding
LPLA has less shares outstanding than it did 5 years ago.
LPLA has a worse debt/assets ratio than last year.
2.2 Solvency
LPLA has an Altman-Z score of 4.02. This indicates that LPLA is financially healthy and has little risk of bankruptcy at the moment.
LPLA has a better Altman-Z score (4.02) than 81.28% of its industry peers.
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.
Looking at the Debt to FCF ratio, with a value of 47.37, LPLA is doing worse than 62.10% of the companies in the same industry.
LPLA has a Debt/Equity ratio of 1.64. This is a high value indicating a heavy dependency on external financing.
LPLA has a worse Debt to Equity ratio (1.64) than 73.97% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.64 | ||
| Debt/FCF | 47.37 | ||
| Altman-Z | 4.02 |
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 has a better Current ratio (2.04) than 67.58% of its industry peers.
A Quick Ratio of 2.04 indicates that LPLA has no problem at all paying its short term obligations.
With a decent Quick ratio value of 2.04, LPLA is doing good in the industry, outperforming 67.58% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.04 | ||
| Quick Ratio | 2.04 |
3. Growth
3.1 Past
LPLA shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -3.79%.
The Earnings Per Share has been growing by 24.51% on average over the past years. This is a very strong growth
LPLA shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 18.21%.
The Revenue has been growing by 14.14% on average over the past years. This is quite good.
EPS 1Y (TTM)-3.79%
EPS 3Y34.46%
EPS 5Y24.51%
EPS Q2Q%11.23%
Revenue 1Y (TTM)18.21%
Revenue growth 3Y19.63%
Revenue growth 5Y14.14%
Sales Q2Q%22.06%
3.2 Future
LPLA is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 12.79% yearly.
LPLA is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 11.07% yearly.
EPS Next Y5.14%
EPS Next 2Y11.37%
EPS Next 3Y13%
EPS Next 5Y12.79%
Revenue Next Year21.11%
Revenue Next 2Y20.24%
Revenue Next 3Y17.67%
Revenue Next 5Y11.07%
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 estimated forward Revenue growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 22.14, LPLA is valued on the expensive side.
Based on the Price/Earnings ratio, LPLA is valued a bit more expensive than the industry average as 61.19% of the companies are valued more cheaply.
The average S&P500 Price/Earnings ratio is at 27.94. LPLA is valued slightly cheaper when compared to this.
A Price/Forward Earnings ratio of 17.94 indicates a rather expensive valuation of LPLA.
LPLA's Price/Forward Earnings is on the same level as the industry average.
Compared to an average S&P500 Price/Forward Earnings ratio of 24.11, LPLA is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.14 | ||
| Fwd PE | 17.94 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, LPLA is valued cheaper than 81.74% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of LPLA indicates a slightly more expensive valuation: LPLA is more expensive than 65.75% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 272.21 | ||
| EV/EBITDA | 13.61 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
LPLA has a very decent profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as LPLA's earnings are expected to grow with 13.00% in the coming years.
PEG (NY)4.31
PEG (5Y)0.9
EPS Next 2Y11.37%
EPS Next 3Y13%
5. Dividend
5.1 Amount
LPLA has a yearly dividend return of 0.35%, which is pretty low.
LPLA's Dividend Yield is slightly below the industry average, which is at 9.45.
With a Dividend Yield of 0.35, LPLA pays less dividend than the S&P500 average, which is at 2.28.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.35% |
5.2 History
The dividend of LPLA has a limited annual growth rate of 3.46%.
LPLA has paid a dividend for at least 10 years, which is 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.
The dividend of LPLA is growing, but earnings are growing more, so the dividend growth is sustainable.
DP8.94%
EPS Next 2Y11.37%
EPS Next 3Y13%
LPL FINANCIAL HOLDINGS INC
NASDAQ:LPLA (1/17/2025, 8:12:56 PM)
After market: 349.25 +0.32 (+0.09%)348.93
+2.72 (+0.79%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryCapital Markets
Earnings (Last)
Earnings (Next)
Inst Owners97.59%
Inst Owner Change-0.27%
Ins Owners0.52%
Ins Owner Change-0.15%
Market Cap26.13B
Analysts80.87
Price Target348.4 (-0.15%)
Short Float %1.07%
Short Ratio1.38
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.35% |
Yearly Dividend1.2
Dividend Growth(5Y)3.46%
DP8.94%
Div Incr Years1
Div Non Decr Years11
Ex-DateN/A
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)7.9%
PT rev (3m)22.36%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-4.27%
EPS NY rev (1m)0%
EPS NY rev (3m)1.24%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)4.46%
Revenue NY rev (1m)0.07%
Revenue NY rev (3m)0.93%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.14 | ||
| Fwd PE | 17.94 | ||
| P/S | 2.27 | ||
| P/FCF | 272.21 | ||
| P/OCF | 43.63 | ||
| P/B | 9.43 | ||
| P/tB | 215.7 | ||
| EV/EBITDA | 13.61 |
EPS(TTM)15.76
EY4.52%
EPS(NY)19.45
Fwd EY5.57%
FCF(TTM)1.28
FCFY0.37%
OCF(TTM)8
OCFY2.29%
SpS153.8
BVpS37.02
TBVpS1.62
PEG (NY)4.31
PEG (5Y)0.9
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.42% | ||
| ROE | 36.27% | ||
| ROCE | 18.58% | ||
| ROIC | 13.92% | ||
| ROICexc | 20.59% | ||
| ROICexgc | 60.57% | ||
| OM | 14.23% | ||
| PM (TTM) | 8.73% | ||
| GM | 98.97% | ||
| FCFM | 0.83% |
ROA(3y)8.31%
ROA(5y)8.33%
ROE(3y)39.28%
ROE(5y)41.69%
ROIC(3y)14.97%
ROIC(5y)14.71%
ROICexc(3y)26.13%
ROICexc(5y)24.76%
ROICexgc(3y)615.87%
ROICexgc(5y)466.89%
ROCE(3y)19.98%
ROCE(5y)19.86%
ROICexcg growth 3Y-29.21%
ROICexcg growth 5Y-18.68%
ROICexc growth 3Y8.1%
ROICexc growth 5Y4%
OM growth 3Y9.68%
OM growth 5Y3.52%
PM growth 3Y9.63%
PM growth 5Y4.6%
GM growth 3Y0.05%
GM growth 5Y0.03%
F-Score4
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 | 4.02 |
F-Score4
WACCN/A
ROIC/WACCN/A
Cap/Depr(3y)104.72%
Cap/Depr(5y)99.81%
Cap/Sales(3y)3.46%
Cap/Sales(5y)3.16%
Profit Quality(3y)85.2%
Profit Quality(5y)94.67%
High Growth Momentum
Growth
EPS 1Y (TTM)-3.79%
EPS 3Y34.46%
EPS 5Y24.51%
EPS Q2Q%11.23%
EPS Next Y5.14%
EPS Next 2Y11.37%
EPS Next 3Y13%
EPS Next 5Y12.79%
Revenue 1Y (TTM)18.21%
Revenue growth 3Y19.63%
Revenue growth 5Y14.14%
Sales Q2Q%22.06%
Revenue Next Year21.11%
Revenue Next 2Y20.24%
Revenue Next 3Y17.67%
Revenue Next 5Y11.07%
EBIT growth 1Y-6.88%
EBIT growth 3Y31.21%
EBIT growth 5Y18.16%
EBIT Next Year29.12%
EBIT Next 3Y20.53%
EBIT Next 5Y16.29%
FCF growth 1Y-95.36%
FCF growth 3Y-44.35%
FCF growth 5Y-23.64%
OCF growth 1Y-74.79%
OCF growth 3Y-13.42%
OCF growth 5Y-2.49%