By Andrew Welsch

LPL Financial handily beat Wall Street expectations with its fourth quarter report Thursday evening. The financial services firm reported fourth-quarter earnings per share of $4.25 on revenue of $3.5 billion, beating consensus analyst estimates of $3.96 per share on revenue of $3.34 billion, according to FactSet.

Adjusted EPS was up 21% year-over-year and revenue was up 33%, according to LPL's earnings report issued Thursday afternoon.

Shares of LPL were unchanged in afterhours trading. The stock is up 10.8% so far this year compared with a 2.9% gain for the S&P 500.

Equity market appreciation boosted advisory revenue and lifted LPL's assets. The San Diego-based wealth management company said total advisory and brokerage assets increased 29% year over year to $1.7 trillion. Advisory assets increased 30% to $957 billion, LPL said.

In recent years, the company has been expanding rapidly through acquisitions and financial advisor recruiting. LPL's net new assets for the quarter were $68 billion, representing 17% annualized growth.

The huge haul included $40 billion of assets from Prudential Advisors, the wealth management unit of insurer Prudential, and was partially offset by the loss of an advisor practice with $2 billion of assets that separated from LPL. The company said that excluding those two items, organic net new assets were $30 billion, representing an 8% annualized growth rate.

LPL's advisor head count reached 28,888 for the quarter, up 5,202 sequentially and 6,228 year over year, it said. That included approximately 2,200 advisors who joined LPL through its acquisition of Atria Wealth Solutions, and approximately 2,800 advisors from Prudential.

In addition to a large independent broker-dealer, LPL also provides a wealth management platform and back office support to other financial services companies such as Prudential. LPL has been investing in its capabilities and integrating acquired firms such as Atria.

Those efforts have added to the company's expenses, which rose 35% year over year to $3.17 billion for the fourth quarter. LPL is focused on increasing productivity and efficiency as part of its long-term cost management strategy, according to the company's earnings presentation.

Write to Andrew Welsch at andrew.welsch@barrons.com

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January 30, 2025 16:56 ET (21:56 GMT)

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