Analyst Brennan Hawken of BMO Capital maintained a Buy rating on LPL Financial, boosting the price target to $415.00.
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Brennan Hawken has given his Buy rating due to a combination of factors that underscore LPL Financial’s attractive growth and earnings profile. The company delivered fourth-quarter earnings per share that were meaningfully ahead of both his forecast and the broader market’s expectations, driven largely by disciplined expense management and strong advisory and commission revenue performance. He highlights that pricing changes on cash programs are proving more profitable than previously anticipated and that year-end cash balances have held up better than feared, improving the near-term revenue outlook even as modest normalization is expected. Although net new assets came in below consensus and organic growth temporarily slowed, he views this primarily as a timing issue tied to the onboarding of acquired assets rather than a structural weakness.
At the same time, Hawken notes that LPL continues to demonstrate solid execution, with improved retention in its acquired business and record recruiting pipelines that should support accelerating growth as they convert later in the year. He acknowledges risks from valuation and interest rates but argues that few competitors combine LPL’s level of momentum, scale-driven benefits, and growth-at-a-reasonable-price characteristics at the current share price. His updated forecasts reflect higher long-term earnings power from stronger cash economics, partially tempered by higher operating costs, yet still sufficient to justify maintaining a premium multiple on future earnings. Taken together, these elements support his view that the stock offers an appealing risk-reward profile and merit a Buy recommendation.
Hawken covers the Financial sector, focusing on stocks such as Invesco, LPL Financial, and Ameriprise Financial. According to TipRanks, Hawken has an average return of 13.9% and a 63.64% success rate on recommended stocks.
In another report released today, Morgan Stanley also maintained a Buy rating on the stock with a $447.00 price target.