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Research Alert: CFRA Maintains Strong Buy Opinion On Shares Of Lpl Financial Holdings Inc.

· 02/05/2021 06:19

11:15 AM EST, 02/05/2021 (MT Newswires) -- CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:

We raise our target by $25 to $135, 17.7x our '22 EPS estimate, above LPLA's 5-yr forward P/E avg. of 15x on accelerating organic asset growth (+8.8% in Q4) as the firm expands its offerings (RIA custody, M&A solutions) fortifying its reputation of being the destination for advisors to grow their business. We lift our '21 EPS estimate by $0.32 to $6.21 on subsiding ICA headwind given higher back-end rates & elevated cash balances and start '22 at $7.62. LPLA posts Q4 EPS of $1.38 vs. $1.53, $0.18 above consensus driven by a 6% Q/Q rise in gross profit aided by higher net commission & advisory fees (+12% sales-based commissions) and transaction/fee revenues (higher fees & trading volume; expected to normalize in '21). G&A expense remains well controlled (+5% Q/Q) with higher-than-expected guidance for '21 more than offset by the continued momentum in organic growth and better-than-forecast Waddell & Reed retention (80%) with further upside on greater uptake of business solutions and centrally managed products.