Independent financial services firm LPL Financial (NASDAQ: LPLA) will be reporting earnings this Thursday after market hours. Here’s what investors should know.
LPL Financial beat analysts’ revenue expectations by 5% last quarter, reporting revenues of $4.55 billion, up 46.4% year on year. It was an exceptional quarter for the company, with and a beat of analysts’ EPS estimates.
Is LPL Financial a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members.
This quarter, analysts are expecting LPL Financial’s revenue to grow 38.9% year on year to $4.88 billion, improving from the 32.9% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $4.90 per share.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. LPL Financial has a history of exceeding Wall Street’s expectations, beating revenue estimates every single time over the past two years by 3.3% on average.
Looking at LPL Financial’s peers in the investment banking & brokerage segment, some have already reported their Q4 results, giving us a hint as to what we can expect. Jefferies delivered year-on-year revenue growth of 5.7%, beating analysts’ expectations by 3%, and Goldman Sachs reported a revenue decline of 3%, topping estimates by 0.5%. Jefferies traded down 5.6% following the results while Goldman Sachs was up 3.1%.
Read our full analysis of Jefferies’s results here and Goldman Sachs’s results here.
Investors in the investment banking & brokerage segment have had steady hands going into earnings, with share prices flat over the last month. LPL Financial’s stock price was unchanged during the same time and is heading into earnings with an average analyst price target of $445.92 (compared to the current share price of $365.20).
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