Barclays Has Lowered Expectations for LPL Financial (NASDAQ:LPLA) Stock Price

Key Points

• Barclays cut its price target on LPL Financial from $435 to $369 while keeping an "overweight" rating, implying about an 18.6% upside, and other brokers have also trimmed targets leaving a consensus "Moderate Buy" average target of $407.14.
• Strong Q4 results: LPL reported $5.23 EPS vs. $4.82 expected and $4.93B revenue (up 8.4% YoY), but the stock traded at $311.19—well below analyst targets and its 1-year high of $403.58.
• Insiders sold shares over the last quarter (6,990 shares worth ~$2.2M), while institutional ownership remains very high at 95.66%, with major funds increasing stakes.

LPL Financial (NASDAQ:LPLA - Get Free Report) had its price objective dropped by equities research analysts at Barclays from $435.00 to $369.00 in a research report issued to clients and investors on Wednesday,Benzinga reports. The brokerage presently has an "overweight" rating on the financial services provider's stock. Barclays's price target indicates a potential upside of 18.58% from the company's previous close.

Other equities research analysts also recently issued reports about the stock. Morgan Stanley reduced their price target on shares of LPL Financial from $462.00 to $447.00 and set an "overweight" rating on the stock in a research note on Monday, December 22nd. Citigroup reissued a "market outperform" rating on shares of LPL Financial in a research note on Tuesday, February 3rd. Jefferies Financial Group reduced their price target on shares of LPL Financial from $464.00 to $383.00 and set a "buy" rating on the stock in a research note on Monday. UBS Group raised shares of LPL Financial from a "neutral" rating to a "buy" rating and reduced their price target for the company from $406.00 to $380.00 in a research note on Wednesday. Finally, TD Cowen reduced their price target on shares of LPL Financial from $399.00 to $378.00 and set a "hold" rating on the stock in a research note on Friday, January 30th. One investment analyst has rated the stock with a Strong Buy rating, ten have assigned a Buy rating and four have assigned a Hold rating to the stock. According to data from MarketBeat, the company presently has an average rating of "Moderate Buy" and an average target price of $407.14.

LPL Financial Trading Up 4.6%

LPLA stock traded up $13.76 during trading on Wednesday, reaching $311.19. 402,811 shares of the stock were exchanged, compared to its average volume of 977,816. The company has a current ratio of 2.45, a quick ratio of 2.45 and a debt-to-equity ratio of 1.36. The business has a 50 day moving average price of $320.43 and a 200-day moving average price of $343.17. LPL Financial has a 1 year low of $266.62 and a 1 year high of $403.58. The firm has a market capitalization of $24.95 billion, a price-to-earnings ratio of 28.23, a P/E/G ratio of 0.78 and a beta of 0.56.

LPL Financial (NASDAQ:LPLA - Get Free Report) last released its quarterly earnings results on Thursday, January 29th. The financial services provider reported $5.23 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $4.82 by $0.41. The business had revenue of $4.93 billion for the quarter, compared to the consensus estimate of $4.90 billion. LPL Financial had a net margin of 5.08% and a return on equity of 34.19%. The business's revenue was up 8.4% on a year-over-year basis. During the same period in the previous year, the firm earned $4.25 EPS. On average, research analysts predict that LPL Financial will post 19.35 earnings per share for the current year.

Insider Activity at LPL Financial

In related news, CFO Matthew J. Audette sold 1,581 shares of LPL Financial stock in a transaction that occurred on Thursday, February 26th. The shares were sold at an average price of $320.50, for a total value of $506,710.50. Following the completion of the transaction, the chief financial officer owned 21,382 shares in the company, valued at approximately $6,852,931. The trade was a 6.88% decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which is accessible through this hyperlink. Also, Director Matthew Enyedi sold 2,109 shares of LPL Financial stock in a transaction that occurred on Thursday, February 26th. The shares were sold at an average price of $320.15, for a total transaction of $675,196.35. Following the completion of the transaction, the director owned 14,121 shares of the company's stock, valued at $4,520,838.15. This trade represents a 12.99% decrease in their position. The disclosure for this sale is available in the SEC filing. Over the last quarter, insiders sold 6,990 shares of company stock worth $2,201,837. Corporate insiders own 1.30% of the company's stock.

Institutional Inflows and Outflows

Several institutional investors and hedge funds have recently added to or reduced their stakes in the company. Vanguard Group Inc. grew its holdings in LPL Financial by 4.0% during the 3rd quarter. Vanguard Group Inc. now owns 8,303,768 shares of the financial services provider's stock worth $2,762,581,000 after acquiring an additional 317,002 shares in the last quarter. Dodge & Cox lifted its position in shares of LPL Financial by 18.6% during the 4th quarter. Dodge & Cox now owns 3,948,970 shares of the financial services provider's stock worth $1,410,454,000 after buying an additional 619,715 shares during the last quarter. Massachusetts Financial Services Co. MA lifted its position in shares of LPL Financial by 14.7% during the 4th quarter. Massachusetts Financial Services Co. MA now owns 3,719,447 shares of the financial services provider's stock worth $1,328,475,000 after buying an additional 477,094 shares during the last quarter. Capital World Investors lifted its position in shares of LPL Financial by 37.9% during the 4th quarter. Capital World Investors now owns 3,625,357 shares of the financial services provider's stock worth $1,294,869,000 after buying an additional 996,806 shares during the last quarter. Finally, Janus Henderson Group PLC lifted its position in shares of LPL Financial by 9.0% during the 4th quarter. Janus Henderson Group PLC now owns 3,377,553 shares of the financial services provider's stock worth $1,206,371,000 after buying an additional 280,202 shares during the last quarter. Institutional investors and hedge funds own 95.66% of the company's stock.

About LPL Financial

LPL Financial NASDAQ: LPLA is a U.S.-focused financial services firm that provides brokerage, custodial and advisory platforms to independent financial advisors, registered investment advisers and institutions. Operating primarily as an independent broker-dealer and custodian, the company supports a network of advisors with the operational, compliance and clearing infrastructure needed to manage client accounts and deliver investment advice outside of traditional wirehouse models.

The firm's product and service offerings include trade execution and clearing, custody services, retirement plan services, model portfolio and advisory platforms, wealth management technology, investment research and product access across equities, fixed income, mutual funds, exchange-traded funds and insurance and annuity solutions.

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