LPL Financial Holdings Inc. LPLA looks like an attractive investment option right now, given its strong fundamentals and good growth prospects. The company has been witnessing upward earnings estimate revisions off late, reflecting analysts' optimism regarding its earnings growth potential.
Its Zacks Consensus Estimate for current-year earnings has been revised 6.8% upward over the past 30 days. Thus, the stock currently carries a Zacks Rank #2 (Buy).
The company's price performance looks impressive. Its shares have rallied 16% so far this year against the industry
's decline of 4.8%. Moreover, LPL Financial has a Momentum Score
of A. Our research shows that stocks, with a Style Score of 'A' or 'B,' when combined with a Zacks Rank #1 (Strong Buy) or 2, offer the best upside potential.
LPL Financial has a number of other aspects that make it a solid pick right now. Earnings per Share (EPS) Strength
: LPL Financial has witnessed 5.8% growth in earnings per share over the last three to five years. This momentum is expected to continue in the near term, as evident from its projected EPS growth rate of 73% and 15.5% for 2018, and 2019, respectively.
Further, its long-term (three to five years) expected EPS growth rate of 15% promises rewards for shareholders. Revenue Growth
: LPL Financial's revenues have witnessed a CAGR of 3.2% over the last six years (2012-2017). Further, the top line is expected to increase 20.3% in 2018, higher than the industry average of 6.3%. Superior Return on Equity (ROE)
: LPL Financial has an ROE of 35.98%, which is far better than the industry average of 9.20%. This shows that the company reinvests its cash more efficiently than its peers. Stock Looks Undervalued
: If we compare the company's price-to-earnings (P/E) and price-to-sales (P/S) ratios with the respective industry averages, the stock appears undervalued. Its P/E (F1) and P/S ratios are 12.6 and 1.2, below the respective industry averages of 14.5 and 1.6. Other Stocks to Consider
Other top-ranked stocks worth considering from the finance space are Commerce Bancshares, Inc. CBSH
, Enterprise Financial Services Corp EFSC
and Wintrust Financial Corporation WTFC
Over the past 60 days, Commerce Bancshares witnessed an upward earnings estimate revision of 7.2% for 2018. Its share price has increased 36.4% over the past year. The stock currently sports a Zacks Rank of 1. You can see the complete list of today's Zacks #1 Rank stocks here
Enterprise Financial currently has a Zacks Rank of 2. It has witnessed an upward earnings estimate revision of 3.3% for the current year over the past 60 days. Its shares have surged 49% in the past year.
Wintrust Financial presently has a Zacks Rank #2. Its earnings estimates have been revised upward by nearly 2.7% over the past 60 days. Its shares have rallied 26.6% last year. Will You Make a Fortune on the Shift to Electric Cars?
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Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Commerce Bancshares, Inc. (CBSH): Free Stock Analysis Report Wintrust Financial Corporation (WTFC): Free Stock Analysis Report Enterprise Financial Services Corporation (EFSC): Free Stock Analysis Report LPL Financial Holdings Inc. (LPLA): Free Stock Analysis Report To read this article on Zacks.com click here.