Hargreaves Lansdown (HL) AI Stock Analysis

• Market Cap: $5.26B
• Dividend Yield: 3.81%
• Average Volume (3M): 4.09M
• Price to Earnings (P/E): 17.9
• Beta (1Y): 0.99
• Revenue Growth: 4.05%
• EPS Growth: -9.50%
• Country: UK
• Employees: 2,484
• Sector: Financial
• Sector Strength: 79
• Industry: Asset Management Services
• EPS (TTM): 0.62
• Shares Outstanding: 474,874,180
• 10 Day Avg. Volume: 3,694,933
• 30 Day Avg. Volume: 4,091,739
• PEG Ratio: -1.32B
• Price to Book (P/B): 6.45
• Price to Sales (P/S): 6.13
• P/FCF Ratio: 15.58
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $1,139.76
• Price Target Upside: 2.87% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 0

• Rating: 76 Outperform
• Price Target: ―

Hargreaves Lansdown demonstrates strong financial health with consistent revenue growth, robust profitability margins, and efficient cash flow generation, which are significant strengths. Technical indicators show a stable price trend with potential upward momentum. The valuation is fair, with a reasonable P/E ratio and an attractive dividend yield. Some margin compression and minor equity reductions are areas to watch, but the overall financial resilience supports a solid stock rating.

Hargreaves Lansdown Business Overview & Revenue Model

Company Description

Hargreaves Lansdown (HL) is a leading financial service company based in the United Kingdom, specializing in investment services and wealth management. The company provides a wide range of products and services, including investment platforms, individual savings accounts (ISAs), self-invested personal pensions (SIPPs), and stockbroking services. HL is a significant player in the asset management and financial advisory sectors, catering primarily to individual investors looking to manage and grow their financial assets.

How the Company Makes Money

Hargreaves Lansdown generates revenue primarily through fees and commissions associated with its investment platform and financial services. Key revenue streams include management fees charged on assets under administration, dealing commissions from stockbroking activities, and service fees for managing SIPPs and ISAs. Additionally, HL earns interest income on client cash balances held within their accounts. The company benefits from economies of scale as its client base expands, and it often forms partnerships with fund managers and other financial institutions to offer a diverse range of investment products. Market factors, such as asset performance and interest rate fluctuations, significantly impact HL's earnings.

Hargreaves Lansdown Financial Statement Overview

Summary

Hargreaves Lansdown showcases a strong financial position with consistent revenue growth and robust profitability margins. The minimal debt level and strong equity foundation reflect prudent financial management. Healthy cash flow metrics highlight the company's ability to generate significant cash from operations, supporting its growth initiatives and financial resilience. While some margin compression and slight reductions in equity pose areas for improvement, the overall financial health remains commendable.

Income Statement

The company shows strong revenue growth with an increase from £735.1M to £764.9M in the latest year, indicating a solid upward trend. Gross profit margin remains healthy at 73.44%, though it has slightly decreased from last year’s 80.86%. The net profit margin is strong at 38.33%, reflecting effective cost management despite a slight decrease from the previous year's 44.04%. The EBIT margin stands robust at 47.93%, highlighting efficient operational performance. Overall, the income statement reflects a company with consistent profitability and growth, though slight compression in margins suggests some cost pressures.

Balance Sheet

The balance sheet reveals a solid equity position with a debt-to-equity ratio of 0.01, indicating minimal reliance on debt. The equity ratio is stable at 54.36%, reflecting a strong equity foundation relative to total assets. Return on equity is commendable at 35.96%, showcasing effective utilization of equity to generate profits. However, the slight decrease in stockholders' equity from the previous year raises caution about potential equity dilution or asset revaluation.

Cash Flow

The company exhibits strong cash flow generation, with a notable increase in free cash flow from £192.6M to £332.5M, demonstrating robust cash flow management. The operating cash flow to net income ratio is 1.18, indicating that operating activities are generating ample cash relative to reported net income. The free cash flow to net income ratio of 1.13 further supports the company’s ability to convert profits into cash. This healthy cash flow position underscores the company's operational efficiency and financial flexibility.

Breakdown
Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement		Total Revenue
764.90M	735.10M	583.00M	631.00M	550.90M
	Gross Profit
561.90M	594.40M	427.50M	511.20M	449.70M
	EBIT
366.70M	384.40M	270.00M	365.60M	337.70M
	EBITDA
411.20M	399.70M	286.10M	381.80M	351.30M
	Net Income Common Stockholders
293.20M	323.80M	216.30M	296.70M	313.10M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
637.50M	498.50M	508.80M	504.40M	463.40M
	Total Assets
1.50B	1.29B	1.08B	1.38B	1.28B
	Total Debt
8.60M	12.20M	16.40M	19.80M	23.20M
	Net Debt
-607.70M	-355.80M	-471.60M	-423.70M	-209.60M
	Total Liabilities
684.10M	576.10M	502.70M	791.70M	718.50M
	Stockholders Equity
815.10M	709.70M	575.10M	593.50M	558.30M
Cash Flow		Free Cash Flow
332.50M	192.60M	249.20M	310.40M	249.50M
	Operating Cash Flow
345.50M	215.30M	262.90M	328.60M	265.40M
	Investing Cash Flow
96.20M	-132.40M	26.40M	151.70M	7.80M
	Financing Cash Flow
-198.40M	-197.90M	-246.30M	-270.90M	-216.60M

Hargreaves Lansdown Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1108.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:HL, the sentiment is Positive. The current price of 1108 is above the 20-day moving average (MA) of 1105.88, above the 50-day MA of 1103.15, and above the 200-day MA of 1088.20, indicating a bullish trend. The MACD of 1.75 indicates Negative momentum. The RSI at 69.95 is Neutral, neither overbought nor oversold. The STOCH value of 73.81 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GB:HL.

Hargreaves Lansdown Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
III	81 Outperform	£41.06B	8.15	22.50%	1.43%	78.18%	-6.27%
AJB	80 Outperform	£1.99B	22.55	47.17%	1.84%	18.52%	9.87%
HL	76 Outperform	$5.26B	17.91	38.21%	3.81%	4.05%	-9.50%
ITV	68 Neutral	£3.02B	7.80	22.70%	8.16%	-3.75%	98.08%
LGEN	66 Neutral	£14.72B	89.13	4.06%	11.93%	-21.56%	-61.14%
Sector *	64 Neutral	$12.85B	9.81	7.79%	78.20%	12.23%	-7.93%
STJ	64 Neutral	£5.89B	15.22	35.30%	2.16%	36.14%	―