LPL Financial Holdings provides an integrated platform of brokerage and investment advisory services to independent financial advisors and financial advisors at financial institutions in the United States. The company was established in 1989 and is based in Boston, Massachusetts.
LPLA Price Forecast Based on DCF Valuation
DCF Fair Value Target:
The table below illustrates the output of a discounted cash flow forecast using a variety of scenarios for LPL Financial Holdings Inc. To summarize, we found that LPL Financial Holdings Inc ranked in the 80th percentile in terms of potential gain offered. Specifically, our DCF analysis implies the stock is trading below its fair value by an estimated 547.17%. As for the metrics that stood out in our discounted cash flow analysis of LPL Financial Holdings Inc, consider:
The compound growth rate in the free cash flow of LPL Financial Holdings Inc over the past 5.77 years is 0.36%; that's better than 82.43% of cash flow producing equities in the Financial Services sector, where it is classified.
LPL Financial Holdings Inc's weighted average cost of capital (WACC) is 7%; for context, that number is higher than only 11.32% of tickers in our DCF set.
LPLA's estimated cost of debt, based largely on its market capitalization and its interest coverage ratio, is 2%; for context, that number is higher than only 11.32% of tickers in our DCF set.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
For other companies in the Financial Services that have a similar discounted cashflow valuation profile (and ensuing price forecasts) as LPLA, try CGBD, HIG, UNM, ESNT, and TSLX.
Key Financial Results * Earnings per share ("EPS") was $1.27, and Net Income was $102 million. * Gross Profit** was $488 million. * Core G&A** was $222 million. * EBITDA** was $207 million and EBITDA** as a percentage of Gross Profit** was 42%. * EPS Prior to Amortization of Intangible Assets** was $1.42.Key Business Results * Total Brokerage and Advisory Assets increased 8% year-over-year to $762 billion. * Advisory assets increased by 15% year-over-year to $375 billion. * Total net new assets(1) were an inflow of $13.0 billion, translating to a 7.8% annualized growth rate, bringing the trailing twelve-month average organic growth rate to 6.9%. * Total net new asset annualized growth rate was 6.1% in April, 7.0% in May, and 8.7% in June. * Net new adviso...
CHARLOTTE, N.C., July 29, 2020 (GLOBE NEWSWIRE) -- LPL Financial LLC, a leading retail investment advisory firm, independent broker-dealer and registered investment advisor (RIA) custodian, today announced that Scott Seese, LPL managing director and chief information officer, is a finalist for a 2020 Charlotte CIO of the Year ORBIE Award. Presented by the Charlotte CIO Leadership Association, the awards program recognizes chief information officers who have demonstrated excellence in innovation, technology leadership, business value creation and community involvement. “On behalf of LPL and our clients, I congratulate Scott on being recognized for the contributions he has made to our advisors, our firm, our industry and our communities,” said Dan Arnold, LPL Financial President and CEO...
M&T; Bank Corporation (NYSE: MTB) announced today that it has chosen LPL Financial (Nasdaq: LPLA), a leading retail investment advisory firm, independent broker-dealer, and registered investment advisor (RIA) custodian, to support the bank's retail brokerage and advisory business. M&T; provides consumer and commercial services to clients in the Northeast and Mid-Atlantic, and currently provides a wide range of brokerage, advisory, and insurance solutions through its subsidiary, M&T; Securities, Inc. The business is expected to transition to the LPL platform in the middle of 2021 and will operate under a new brand name.