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1. Company Snapshot

1.a. Company Description

LPL Financial Holdings Inc., together with its subsidiaries, provides an integrated platform of brokerage and investment advisory services to independent financial advisors and financial advisors at financial institutions in the United States.Its brokerage offerings include variable and fixed annuities, mutual funds, equities, retirement and education savings plans, fixed income, and insurance, as well as alternative investments, such as non-traded real estate investment trusts and auction rate notes.The company also provides advisory platforms that provide access to mutual funds, exchange-traded funds, stocks, bonds, certain option strategies, unit investment trusts, and institutional money managers and no-load multi-manager variable annuities.


In addition, it offers money market programs; and retirement solutions for commission-and fee-based services that allow advisors to provide brokerage services, consultation, and advice to retirement plan sponsors.Further, the company provides other services comprising tools and services that enable advisors to maintain and grow their practices; trust, investment management oversight, and custodial services to trusts for estates and families, as well as insurance brokerage general agency services; and technology products, such as proposal generation, investment analytics, and portfolio modeling.The company was formerly known as LPL Investment Holdings Inc.


and changed its name to LPL Financial Holdings Inc.in June 2012.LPL Financial Holdings Inc.


was founded in 1989 and is based in San Diego, California.

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1.b. Last Insights on LPLA

LPL Financial Holdings Inc.'s recent performance was negatively impacted by a sharp rise in expenses, which overshadowed strong revenues and asset growth. The company's Q4 earnings beat was accompanied by a significant increase in costs, which likely concerned investors. Additionally, the brokerage sector's sell-off on AI disruption concerns further pressured the stock. A decrease in stake by Atria Investments Inc. and a leverage-neutral refinancing of existing debt may have also contributed to the negative sentiment. Expenses, particularly Core G&A, increased 27% year-over-year.

1.c. Company Highlights

2. LPL Financial's Strong Q4 2025 Earnings: A Milestone Year

LPL Financial Holdings Inc. reported a robust fourth-quarter 2025 earnings, with adjusted EPS reaching a record $5.23, up 23% from the previous year, surpassing analyst estimates of $4.92. Total assets increased to a record $2.4 trillion, driven by organic growth and higher equity markets. The company attracted organic net new assets of $23 billion, representing a 4% annualized growth rate. For the full year, LPL reported record adjusted EPS of $20.09, demonstrating significant advancements in its strategic priorities.

Publication Date: Feb -15

📋 Highlights
  • Record Total Assets: Surpassed $2.4 trillion, driven by 8% organic growth and acquisitions like Commonwealth Financial Network.
  • Adjusted EPS Surge: Q4 adjusted EPS hit $5.23 (up 23% YoY), with full-year record at $20.09.
  • Commonwealth Acquisition Progress: Expected $425M run-rate EBITDA post-integration, with 90% asset retention target.
  • Strong Organic Growth: Q4 net new assets of $23B (4% annualized), bolstered by 2.5% January organic growth.
  • Capital Deployment Strategy: Leverage near 1.95x, with $380M–$390M incremental expenses from Commonwealth and potential early share buyback resumption.

Strategic Advancements and Growth

LPL's strategic plan focuses on maintaining client centricity, empowering employees, and delivering improved operating leverage. The company achieved industry-leading organic asset growth of 8%, onboarding several large wealth management businesses, including WinTrust Financial, First Horizon, and Atria Wealth Solutions. The acquisition of Commonwealth Financial Network is progressing well, with an estimated run-rate EBITDA of approximately $425 million once fully integrated.

Valuation and Outlook

With a P/E Ratio of 31.04 and an EV/EBITDA of 15.12, the market has priced in significant growth expectations. LPL's ROE of 18.57% and ROIC of 21.59% indicate strong profitability. The company's guidance for 2026 core G&A growth of 4.5% to 7% and expected EBITDA contribution from Commonwealth suggest sustained growth momentum. Analysts estimate next year's revenue growth at 13.8%, supporting the current valuation.

Business Momentum and Pipeline

LPL's pipelines continue to build, with a near-record level of early- and mid-stage recruits. The company has seen an increased win rate of advisers, particularly from wirehouses, driven by improved affiliation models and enhanced product and lending capabilities. January's organic growth was around 2.5%, with advisory fees hitting primarily in the first month of the quarter, indicating a strong start to the year.

Capital Deployment and Shareholder Returns

LPL's capital management framework prioritizes investing in organic growth, M&A, and returning excess capital to shareholders. The company aims to reduce leverage to two times before considering share repurchases and is considering starting share repurchases a quarter earlier than expected due to successful deleveraging.

Liquidity and Succession Solutions Business

The L&S business has acquired practices at 6-8 times earnings, with high-quality, recurring, non-cash sweep earnings. Cash balances have been stable, with an average balance per account of around $5,000, and are expected to remain stable to up as interest rates come down.

3. NewsRoom

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LPL Financial Reports Rise in January Brokerage & Advisory Assets

Feb -20

Source: zacks.com

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LPL Financial Reports Monthly Activity for January 2026

Feb -19

Source: globenewswire.com

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LPLA Partners With Simplicity to Boost Insurance Arm & Advisor Support

Feb -19

Source: zacks.com

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LPL Welcomes Tom Madigan to the Thimble Island Private Wealth Team

Feb -19

Source: globenewswire.com

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Simplicity Group and LPL Financial Form Strategic Relationship to Deliver Insurance Products, Operational Support, and Training to LPL Advisors

Feb -18

Source: prnewswire.com

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Steve Mandel's Strategic Moves: Meta Platforms Inc. Exit Impacts Portfolio by -7.07%

Feb -17

Source: gurufocus.com

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LPL Financial Welcomes Shoreline Private Wealth Management

Feb -17

Source: globenewswire.com

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LPL Financial: AI Selloff Is Your Opportunity

Feb -16

Source: seekingalpha.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (15.00%)

6. Segments

Brokerage and Investment Advisory Services

Expected Growth: 15%

LPL Financial Holdings Inc.'s 15% growth in Brokerage and Investment Advisory Services is driven by increasing demand for wealth management, expansion of independent advisor network, and strategic acquisitions. Additionally, the company's technology enhancements, such as its ClientWorks platform, have improved advisor efficiency and client engagement, contributing to the growth.

7. Detailed Products

Wealth Management

LPL Financial Holdings Inc. offers a range of wealth management services, including investment management, financial planning, and retirement planning, to help individuals and families achieve their financial goals.

Brokerage Services

LPL Financial Holdings Inc. provides brokerage services, including trading and execution, to individual and institutional clients, offering access to a range of investment products and markets.

Insurance Services

LPL Financial Holdings Inc. offers a range of insurance products, including life insurance, long-term care insurance, and disability insurance, to help individuals and families protect their financial well-being.

Retirement Plan Services

LPL Financial Holdings Inc. provides retirement plan services, including 401(k), 403(b), and IRA plans, to help employers and employees plan for retirement.

Custody and Clearing Services

LPL Financial Holdings Inc. provides custody and clearing services, including trade execution, settlement, and custody, to independent financial advisors and institutions.

8. LPL Financial Holdings Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

LPL Financial Holdings Inc. operates in a highly competitive industry, and there are many substitutes available to customers. However, the company's strong brand reputation and wide range of financial services help to mitigate the threat of substitutes.

Bargaining Power Of Customers

LPL Financial Holdings Inc. has a large customer base, but individual customers do not have significant bargaining power. The company's diversified customer base and wide range of financial services help to reduce the bargaining power of customers.

Bargaining Power Of Suppliers

LPL Financial Holdings Inc. has a diverse supplier base, and no single supplier has significant bargaining power. The company's strong financial position and long-term contracts with suppliers also help to reduce the bargaining power of suppliers.

Threat Of New Entrants

The financial services industry has high barriers to entry, including regulatory hurdles and significant capital requirements. While new entrants may emerge, they are unlikely to pose a significant threat to LPL Financial Holdings Inc.'s market position.

Intensity Of Rivalry

The financial services industry is highly competitive, with many established players competing for market share. LPL Financial Holdings Inc. faces intense competition from other financial institutions, which can lead to pricing pressure and reduced market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 64.53%
Debt Cost 6.78%
Equity Weight 35.47%
Equity Cost 8.11%
WACC 7.25%
Leverage 181.92%

11. Quality Control: LPL Financial Holdings Inc. passed 5 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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A-Score: 5.3/10

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Quality: 6.5

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

306.43$

Current Price

306.43$

Potential

-0.00%

Expected Cash-Flows