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LPL Financial's (LPLA) April Metrics Rise on Upbeat Markets

LPL Financial's LPLA total brokerage and advisory assets were $1.19 trillion at the end of April 2023, increasing 1.1% from the prior month and 8.4% year over year. The rise in LPLA’s assets balance was mainly due to solid market performance.

Of LPLA’s total assets, brokerage assets were $559.5 billion and advisory assets amounted to $628.2 billion. Brokerage assets were up almost 1% from March 2023 and 9.8% year over year. Advisory assets grew 1.2% from the prior month and 7.1% from April 2022.

LPL Financial’s total net new assets (NNAs) were $4.4 billion in the reported month. NNAs were $10.6 billion and $1.9 billion in March 2023 and April 2022, respectively.

The company reported $50.9 billion of total client cash balance, down 6.8% from March 2023 and 17.5% from April 2022. Of the total balance, $37 billion was insured cash and $9.5 billion was deposit cash, while the remaining was money-market balance.

LPL Financial’s recruiting efforts and solid advisor productivity will support advisory revenues. Also, it is expanding through strategic buyouts on the back of a solid balance sheet position. However, the challenging operating backdrop is a major near-term headwind.

The stock has lost 12.2% over the past six months compared with an 18.1% decline witnessed by the industry.

Zacks Investment Research
Zacks Investment Research


Image Source: Zacks Investment Research

LPLA currently carries a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Competitive Landscape

A couple of other brokerage firms that have already come out with monthly data for April are Interactive Brokers Group IBKR and Charles Schwab SCHW.

Interactive Brokers released the Electronic Brokerage segment’s performance metrics for April 2023. The segment deals with the clearance and settlement of trades for individual and institutional clients globally. It reported a decline in client Daily Average Revenue Trades (DARTs) on a sequential and a year-over-year basis.

IBKR's total client DARTs for the month were 1,765,000, which declined 14% from the March 2023 level and 20% year over year.

Schwab released its monthly activity report for April 2023. Core net new assets were negative $2.3 billion in the month. It had reported core net new assets of $53.9 billion in March 2023 and negative net new assets of $9.2 million.

SCHW’s total client assets were $7.63 trillion, up 1% from March 2023 and 5% from April 2022. Likewise, client assets receiving ongoing advisory services were $3.92 trillion, rising marginally from the prior month and 6% year over year.

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Zacks Investment Research