LPL FINANCIAL HOLDINGS INC (LPLA) Stock Fundamental Analysis
USA - NASDAQ:LPLA - US50212V1008 - Common Stock
350.64 USD
+2.93 (+0.84%)
349 USD
-1.64 (-0.47%)
Taking everything into account, LPLA scores 6 out of 10 in our fundamental rating. LPLA was compared to 238 industry peers in the Capital Markets industry. While LPLA has a great profitability rating, there are some minor concerns on its financial health. LPLA has a decent growth rate and is not valued too expensively.
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.
In the past 5 years LPLA has always been profitable.
LPLA had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
LPLA has a better Return On Assets (6.40%) than 78.57% of its industry peers.
LPLA has a better Return On Equity (22.03%) than 88.66% of its industry peers.
Looking at the Return On Invested Capital, with a value of 10.46%, LPLA belongs to the top of the industry, outperforming 84.87% of the companies in the same industry.
LPLA had an Average Return On Invested Capital over the past 3 years of 15.44%. This is significantly above the industry average of 7.61%.
The 3 year average ROIC (15.44%) for LPLA is well above the current ROIC(10.46%). The reason for the recent decline needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.4% | ||
| ROE | 22.03% | ||
| ROIC | 10.46% |
ROA(3y)9.04%
ROA(5y)8.01%
ROE(3y)42.14%
ROE(5y)37.98%
ROIC(3y)15.44%
ROIC(5y)14.04%
1.3 Margins
LPLA has a Profit Margin of 7.91%. This is in the lower half of the industry: LPLA underperforms 63.03% of its industry peers.
In the last couple of years the Profit Margin of LPLA has declined.
The Operating Margin of LPLA (13.92%) is worse than 65.55% of its industry peers.
LPLA's Operating Margin has declined in the last couple of years.
With an excellent Gross Margin value of 98.92%, LPLA belongs to the best of the industry, outperforming 99.16% of the companies in the same industry.
LPLA's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 13.92% | ||
| PM (TTM) | 7.91% | ||
| GM | 98.93% |
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
Compared to 1 year ago, LPLA has about the same amount of shares outstanding.
Compared to 5 years ago, LPLA has less shares outstanding
Compared to 1 year ago, LPLA has a worse debt to assets ratio.
2.2 Solvency
An Altman-Z score of 3.46 indicates that LPLA is not in any danger for bankruptcy at the moment.
LPLA has a better Altman-Z score (3.46) than 78.15% of its industry peers.
A Debt/Equity ratio of 1.44 is on the high side and indicates that LPLA has dependencies on debt financing.
LPLA's Debt to Equity ratio of 1.44 is on the low side compared to the rest of the industry. LPLA is outperformed by 69.33% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.44 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 3.46 |
ROIC/WACCN/A
WACCN/A
2.3 Liquidity
LPLA has a Current Ratio of 3.05. This indicates that LPLA is financially healthy and has no problem in meeting its short term obligations.
The Current ratio of LPLA (3.05) is better than 81.09% of its industry peers.
LPLA has a Quick Ratio of 3.05. This indicates that LPLA is financially healthy and has no problem in meeting its short term obligations.
The Quick ratio of LPLA (3.05) is better than 81.09% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.05 | ||
| Quick Ratio | 3.05 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 17.80% over the past year.
Measured over the past years, LPLA shows a quite strong growth in Earnings Per Share. The EPS has been growing by 18.07% on average per year.
LPLA shows a strong growth in Revenue. In the last year, the Revenue has grown by 29.23%.
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)17.8%
EPS 3Y32.96%
EPS 5Y18.07%
EPS Q2Q%16.24%
Revenue 1Y (TTM)29.23%
Revenue growth 3Y17.06%
Revenue growth 5Y17.1%
Sales Q2Q%30.81%
3.2 Future
The Earnings Per Share is expected to grow by 10.60% on average over the next years. This is quite good.
The Revenue is expected to grow by 8.27% on average over the next years. This is quite good.
EPS Next Y17.5%
EPS Next 2Y19.23%
EPS Next 3Y20.06%
EPS Next 5Y10.6%
Revenue Next Year34.86%
Revenue Next 2Y27.29%
Revenue Next 3Y22.76%
Revenue Next 5Y8.27%
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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
LPLA is valuated rather expensively with a Price/Earnings ratio of 19.40.
The rest of the industry has a similar Price/Earnings ratio as LPLA.
The average S&P500 Price/Earnings ratio is at 27.30. LPLA is valued slightly cheaper when compared to this.
LPLA is valuated correctly with a Price/Forward Earnings ratio of 14.95.
LPLA's Price/Forward Earnings is on the same level as the industry average.
LPLA is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 22.73, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.4 | ||
| Fwd PE | 14.95 |
4.2 Price Multiples
LPLA's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. LPLA is cheaper than 86.55% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 11.86 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct 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 20.06% in the coming years.
PEG (NY)1.11
PEG (5Y)1.07
EPS Next 2Y19.23%
EPS Next 3Y20.06%
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 7.96.
With a Dividend Yield of 0.35, LPLA pays less dividend than the S&P500 average, which is at 2.41.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.35% |
5.2 History
The dividend of LPLA has a limited annual growth rate of 3.76%.
LPLA has paid a dividend for at least 10 years, which is a reliable track record.
LPLA has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)3.76%
Div Incr Years0
Div Non Decr Years11
5.3 Sustainability
LPLA pays out 8.17% 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.
DP8.17%
EPS Next 2Y19.23%
EPS Next 3Y20.06%
350.64
+2.93 (+0.84%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryCapital Markets
Earnings (Last)
Earnings (Next)
Inst Owners98.99%
Inst Owner Change1.63%
Ins Owners0.39%
Ins Owner Change0.02%
Market Cap28.05B
Analysts80.95
Price Target450.42 (28.46%)
Short Float %3.55%
Short Ratio3.47
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.35% |
Yearly Dividend1.2
Dividend Growth(5Y)3.76%
DP8.17%
Div Incr Years0
Div Non Decr Years11
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)6.36%
Min EPS beat(2)4.59%
Max EPS beat(2)8.12%
EPS beat(4)4
Avg EPS beat(4)7.08%
Min EPS beat(4)4.59%
Max EPS beat(4)9.9%
EPS beat(8)8
Avg EPS beat(8)5.48%
EPS beat(12)11
Avg EPS beat(12)4.74%
EPS beat(16)15
Avg EPS beat(16)5.1%
Revenue beat(2)1
Avg Revenue beat(2)0.2%
Min Revenue beat(2)-0.35%
Max Revenue beat(2)0.76%
Revenue beat(4)2
Avg Revenue beat(4)0.61%
Min Revenue beat(4)-0.88%
Max Revenue beat(4)2.92%
Revenue beat(8)4
Avg Revenue beat(8)0.5%
Revenue beat(12)5
Avg Revenue beat(12)0.05%
Revenue beat(16)9
Avg Revenue beat(16)2.18%
PT rev (1m)-0.81%
PT rev (3m)5.81%
EPS NQ rev (1m)-0.64%
EPS NQ rev (3m)-4.1%
EPS NY rev (1m)0.29%
EPS NY rev (3m)-0.12%
Revenue NQ rev (1m)5.63%
Revenue NQ rev (3m)9.6%
Revenue NY rev (1m)5.39%
Revenue NY rev (3m)6.81%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.4 | ||
| Fwd PE | 14.95 | ||
| P/S | 1.99 | ||
| P/FCF | N/A | ||
| P/OCF | 49.77 | ||
| P/B | 5.53 | ||
| P/tB | 22.99 | ||
| EV/EBITDA | 11.86 |
EPS(TTM)18.07
EY5.15%
EPS(NY)23.45
Fwd EY6.69%
FCF(TTM)-0.07
FCFYN/A
OCF(TTM)7.05
OCFY2.01%
SpS176.57
BVpS63.43
TBVpS15.25
PEG (NY)1.11
PEG (5Y)1.07
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.4% | ||
| ROE | 22.03% | ||
| ROCE | 13.96% | ||
| ROIC | 10.46% | ||
| ROICexc | 17.77% | ||
| ROICexgc | 49.87% | ||
| OM | 13.92% | ||
| PM (TTM) | 7.91% | ||
| GM | 98.93% | ||
| FCFM | N/A |
ROA(3y)9.04%
ROA(5y)8.01%
ROE(3y)42.14%
ROE(5y)37.98%
ROIC(3y)15.44%
ROIC(5y)14.04%
ROICexc(3y)25.8%
ROICexc(5y)23.26%
ROICexgc(3y)599.08%
ROICexgc(5y)438.7%
ROCE(3y)20.61%
ROCE(5y)18.75%
ROICexcg growth 3Y-20.71%
ROICexcg growth 5Y-23.61%
ROICexc growth 3Y-1.8%
ROICexc growth 5Y-7.03%
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-Score3
Asset Turnover0.81
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.44 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 2.93 | ||
| Cap/Depr | 108.67% | ||
| Cap/Sales | 4.03% | ||
| Interest Coverage | 6.36 | ||
| Cash Conversion | 22.64% | ||
| Profit Quality | N/A | ||
| Current Ratio | 3.05 | ||
| Quick Ratio | 3.05 | ||
| Altman-Z | 3.46 |
F-Score3
WACCN/A
ROIC/WACCN/A
Cap/Depr(3y)115.77%
Cap/Depr(5y)105.75%
Cap/Sales(3y)4.04%
Cap/Sales(5y)3.51%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)17.8%
EPS 3Y32.96%
EPS 5Y18.07%
EPS Q2Q%16.24%
EPS Next Y17.5%
EPS Next 2Y19.23%
EPS Next 3Y20.06%
EPS Next 5Y10.6%
Revenue 1Y (TTM)29.23%
Revenue growth 3Y17.06%
Revenue growth 5Y17.1%
Sales Q2Q%30.81%
Revenue Next Year34.86%
Revenue Next 2Y27.29%
Revenue Next 3Y22.76%
Revenue Next 5Y8.27%
EBIT growth 1Y24.53%
EBIT growth 3Y29%
EBIT growth 5Y14.62%
EBIT Next Year9.69%
EBIT Next 3Y26.54%
EBIT Next 5Y13.75%
FCF growth 1Y-100.3%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y-73.72%
OCF growth 3Y-15.07%
OCF growth 5Y-14.95%