LPL Financial Holdings Inc. (LPLA): A Bull Case Theory

We came across a bullish thesis on LPL Financial Holdings Inc. on investing subreddit by InternationalTop4495. In this article, we will summarize the bulls’ thesis on LPLA. LPL Financial Holdings Inc.'s share was trading at $336.52 as of September 25th. LPLA’s trailing and forward P/E were 23.07 and 23.47 respectively according to Yahoo Finance.

LPL Financial Holdings Inc. (LPL) presents a compelling investment opportunity following a sharp 7.5% sell-off, which appears driven more by market mechanics than any fundamental news. The company, under its current CEO with a UBS background and expertise in digital innovation, has transformed into a leading Wealth Tech platform.

LPL’s revenue-share model attracts independent broker-dealers and advisors, creating durable, high-margin revenue streams and significant stickiness in a sector historically characterized by advisor mobility. Over the past five years, the company has delivered 20%+ earnings and revenue growth, reflecting the robustness of its model.

The wealth management industry is undergoing consolidation, with many advisors approaching retirement, and LPL has actively pursued M&A to expand its platform. UBS, for example, has recently lost advisors following compensation changes, positioning LPL to be a primary beneficiary. Additionally, LPL’s push into private assets for 401(k)s and IRAs increases the importance of advisory services, with partnerships with alternative asset managers such as Blackstone and Apollo positioning the company to capture flows into private asset classes.

The recent price decline has created a short-term dislocation, offering an attractive entry point. Trading below 20x forward P/E, LPL appears relatively inexpensive compared with the S&P 500, while operating in a capital-light business with strong ROE and ROIC. Given its durable revenue model, growth initiatives, and favorable industry tailwinds, LPL offers a compelling risk/reward profile, with potential for substantial upside as the company continues to scale its platform and capture market share in an evolving wealth management landscape.

Previously we covered a bullish thesis on Interactive Brokers Group, Inc. (IBKR) by Chit Chat Stocks in October 2024, which highlighted IBKR’s strong financials, technological edge, and growth potential from expanding brokerage markets. The company's stock price has appreciated approximately by 23.14% (stock price adjusted for stock split in June 2025) since our coverage. The thesis still stands as IBKR continues to benefit from its competitive moat. InternationalTop4495 shares a similar focus but emphasizes LPL’s Wealth Tech platform and revenue-share model.

LPL Financial Holdings Inc. is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 61 hedge fund portfolios held LPLA at the end of the second quarter which was 63 in the previous quarter. While we acknowledge the potential of LPLA as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

READ NEXT: 30 Stocks That Should Double in 3 Years and 11 Hidden AI Stocks to Buy NOW 

Disclosure: None.