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what it is
LPL runs the back office, custody, trading, and compliance machinery for thousands of financial advisors.
how it gets paid
Last year LPL Financial made $17.0B in revenue. Asset-based advisory and brokerage was the main engine at $6.2B, or ~36% of sales.
why it's growing
Revenue grew 37.2% last year. It recorded charges of $419 million, or $5.21 a share, due to onetime acquisition costs associated with the commonwealth financial network, completed in early august.
what just happened
LPL posted $5.23 EPS on its latest report, beating estimates by 40.2%. $12.1B is not credible as one quarter’s revenue vs ~$17B annual—use ~$4.2B quarterly run rate (÷4) or the exact 10-Q line.
At a glance
B+ balance sheet — decent shape, but not bulletproof
65/100 earnings predictability — reasonably predictable
33.7x trailing p/e — you're paying up for this one
0.3% dividend yield — cash in your pocket every quarter
8.0% return on capital — fine for a platform at this scale
xvary composite: 51/100 — below average
What they do
LPL runs the back office, custody, trading, and compliance machinery for thousands of financial advisors.
LPL already sits under 22,000 advisors, 1,100 enterprises, and 570 RIA firms. Platform (the operating system for an advisor's business) → the tools, custody, compliance, and trading stack in one place → so what: if your whole practice runs there, moving is expensive, slow, and risky for client relationships. That scale helps keep new advisors coming while smaller rivals fight for scraps.
How they make money
$17.0B
annual revenue · their business grew +37.2% last year
asset-based advisory and brokerage
$6.2B
net interest income
$5.1B
commissions
$2.5B
service and fee revenue
$1.9B
transaction and other
$1.3B
The products that matter
independent advisor platform
Advisor Platform
22,000 advisors
it's the core network. If advisors stay, the revenue base stays. Right now that platform supports 22,000 advisors across the business.
scale moat
custody and asset servicing
Advisory and Brokerage Assets
$2.3T asset base
this $2.3T asset base drives the economics. When markets rise and assets flow in, revenue usually follows. When markets fall, the same machine works in reverse.
asset-linked
recruiting and acquisitions
Commonwealth Integration
$275B acquired assets
the company added $275B from the Commonwealth acquisition inside $308B of quarterly net new assets. That's a growth accelerant, but it also drove $419M of one-time costs.
integration bet
Key numbers
3.0%
EPS growth
Past earnings grew 26.0% a year. The forward outlook is 3.0%. You are paying 33.7x trailing earnings for a business expected to cool hard.
$419M
one-time charges
That acquisition bill drove a third-quarter loss of $0.37 per share. One deal was enough to flip the quarter red.
$7.5B
long-term debt
Debt equals 20% of capital. That is not a crisis, but it cuts your margin for error if markets or integration go sideways.
22,000
advisor count
This is the moat in plain English. Advisors bring assets, fees, and sticky relationships that get harder to pry away at scale.
Financial health
B+
strength
- balance sheet grade B+ — solid but not elite
- risk rank 3 — safer than 50% of stocks
- price stability 45 / 100
- long-term debt $7.5B (20% of capital)
- net profit margin 6.4% — keeps 6 cents of every dollar in revenue
- return on equity 14% — $0.14 profit for every $1 investors have put in
B+ — functional but not a standout on the balance sheet.
Total return vs. market
You invested $10,000 in LPLA 3 years ago → it's now worth $17,800.
The index would have given you $13,920.
source: institutional data · total return
What just happened
beat estimates
LPL posted $5.23 in EPS on its latest report, beating estimates by 40.2%, with quarterly revenue on the order of ~$4.2B—not $12.1B (that line was a period mix-up vs ~$17B annual).
The clean headline followed a messy year. Earlier, LPL reported a third-quarter loss of $0.37 per share because Commonwealth-related charges reached $419M, even as revenue growth ran hot in that window—confirm vs. prior year off the filing, not a headline scraper.
~$4.2B
qtr revenue (approx.)
$5.23
eps (latest Q · adj./core)
40.2%
surprise
the number that mattered
The 40.2% EPS beat matters most because it shows the core business still throws off earnings power even after a year distorted by acquisition charges.
-
lpl financial fell into the red during the third quarter.
-
the company registered a deficit of $0.37 per share for the september period.
-
it recorded charges of $419 million, or $5.21 a share, due to onetime acquisition costs associated with the commonwealth financial network, completed in early august.
-
the top line, on the other hand, soared 46%, vs. prior year, during the term.
-
total advisory and brokerage assets increased 45% from the year-ago period, to $2.3 trillion.what’s more, lpl closed the september quarter with $308 billion in net new assets, including $275 billion stemming from the commonwealth acquisition.
source: company earnings report, 2026
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What could go wrong
the #1 risk is a market decline cutting asset-based revenue across LPL's $2.3T platform.
med
asset values fall, revenue follows
A large share of this business is tied to advisor assets and client activity. If markets fall, the asset base shrinks and fee revenue usually shrinks with it.
The exposure is big because the platform ended the quarter with $2.3T in advisory and brokerage assets.
med
Commonwealth integration has to earn its keep
LPL added $275B of assets through the Commonwealth acquisition, but the same deal produced $419M of one-time costs. If retention disappoints or costs linger, the math gets worse fast.
The market can forgive one messy quarter. It gets less patient if acquisition costs keep overwhelming earnings.
med
thin margins leave less room for mistakes
A ~6.4% net margin on $17.0B of revenue (per this page’s health row) means this is not a fat tollbooth. Expense creep, payout pressure, or slower advisor recruiting can show up quickly in profit.
When most of each revenue dollar already goes back out the door, even modest cost pressure matters.
Put together, these risks pressure a business with $17.0B in annual revenue and earnings that just swung negative on a $419M charge.
source: institutional data · regulatory filings · risk analysis
Pay attention to
earnings
whether reported earnings normalize
The next few quarters need to show that the $419M acquisition charge was a spike, not the new baseline.
assets
asset growth after the deal closes into the base
$308B of net new assets is a huge number. Watch what asset growth looks like once the Commonwealth bump is fully absorbed.
margin
whether ~6.4% net margin starts moving up
Scale is already here. The next step is proving that more of each revenue dollar can reach the bottom line—use the filing net margin, not a mismatched scrape.
risk
advisor retention and recruiting
This business runs on advisor count and advisor assets. If the 22,000-advisor network stalls or leaks, the story changes.
Analyst rankings
short-term outlook
below average
momentum score 4 — analysts see weaker near-term performance than most stocks from here.
risk profile
average
stability score 3 — the stock sits around the middle on risk. Not especially safe. Not a rollercoaster either.
chart momentum
top 20%
technical score 2 — in human-speak, the chart looks better than the short-term fundamental ranking.
earnings predictability
65 / 100
earnings are reasonably forecastable, but acquisition charges are a reminder that clean numbers can get messy fast.
source: institutional data
Institutional activity
351 buyers vs. 371 sellers in 3q2025. total institutional holdings: 78.8M shares.
source: institutional data
Price targets
3-5 year target range
$291
$623
$371
current price
$457
target midpoint · +23% from current · 3-5yr high: $623
Want the deeper analysis?
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