DCF Tool

LPLA

LPL Financial Holdings Inc – Investment Advice
LPL Financial is a leader in the retail financial advice market and the nation's largest independent broker/dealer*. The Company serves independent financial advisors and financial institutions, providing them with the technology, research, clearing and compliance services, and practice management programs they need to create and grow thriving practices. LPL enables them to provide objective guidance to millions of American families seeking wealth management, retirement planning, financial planning and asset management solutions.
Analysis Results
Intrinsic Value $992.73
Latest Price $226.15
Relative Value 77% undervalued
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Cash Flow (Billions)
Analysis Parameters
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Analysis Details
Growth Rate Projection

An exponential growth model was fit to the past cash flow data, giving more weight to more recent years. This model determined a growth rate estimate of 35.3%.

Weighted Average Cost of Capital (WACC)

The calculated WACC is 7.5%. This value is used as the default discount rate.

Value of Future Flows

Assuming a growth rate of 35.3%, the cash flows for the next 5 years are projected.

The present value of each year's flow is adjusted to present value using the discount rate.

Year Future flow (billion) Present value (billion)
2022 1.65 1.54
2023 2.24 1.93
2024 3.03 2.43
2025 4.09 3.06
2026 5.54 3.86
Terminal Value

Assuming a growth rate after the projection years of 2.0%, the terminal value of the company would be 102 billion. This corresponds to a present value of 66.2 billion.

Intrinsic Value Per Share

The total present value of the projected cash flows is 12.8 billion. Adding in the terminal value gives a total present value of 79.0 billion.

There are presently 79.6 million outstanding shares, so the intrinsic value per share is 992.73.

Financial Statements

The following data was to determine the past cash flows.

Current Assets 4,389,966,000
Current Cash 0
Current Liabilities 2,649,673,000
Current Debt 0
Non-Cash Working Capital (NCWC) 1,740,293,000
Change in NCWC 737,589,000
EBIT 730,143,000
Tax Provision 141,463,000
Depreciation and Amortization 230,688,000
Capital Expenditure -215,987,000
Unlevered Free Cash Flow 1,310,666,430
Current Assets 3,296,697,000
Current Cash 0
Current Liabilities 2,293,993,000
Current Debt 0
Non-Cash Working Capital (NCWC) 1,002,704,000
Change in NCWC 148,009,000
EBIT 731,838,000
Tax Provision 153,433,000
Depreciation and Amortization 177,090,000
Capital Expenditure -155,532,000
Unlevered Free Cash Flow 722,051,953
Current Assets 2,841,016,000
Current Cash 0
Current Liabilities 1,986,321,000
Current Debt 0
Non-Cash Working Capital (NCWC) 854,695,000
Change in NCWC -32,298,000
EBIT 874,992,000
Tax Provision 181,955,000
Depreciation and Amortization 161,113,000
Capital Expenditure -156,389,000
Unlevered Free Cash Flow 632,802,661
Current Assets 2,670,657,000
Current Cash 0
Current Liabilities 1,783,664,000
Current Debt 0
Non-Cash Working Capital (NCWC) 886,993,000
Change in NCWC -19,485,000
EBIT 717,660,000
Tax Provision 153,178,000
Depreciation and Amortization 147,908,000
Capital Expenditure -132,688,000
Unlevered Free Cash Flow 527,902,491
Current Assets 2,605,748,000
Current Cash 0
Current Liabilities 1,699,270,000
Current Debt 0
Non-Cash Working Capital (NCWC) 906,478,000
Change in NCWC -27,361,000
EBIT 494,002,000
Tax Provision 125,707,000
Depreciation and Amortization 122,364,000
Capital Expenditure -111,910,000
Unlevered Free Cash Flow 306,758,687
Current Assets 2,442,232,000
Current Cash 0
Current Liabilities 1,508,393,000
Current Debt 0
Non-Cash Working Capital (NCWC) 933,839,000
Change in NCWC 12,561,000
EBIT 393,994,000
Tax Provision 105,585,000
Depreciation and Amortization 113,963,000
Capital Expenditure -127,646,000
Unlevered Free Cash Flow 253,048,069
Current Assets 2,253,163,000
Current Cash 0
Current Liabilities 1,331,885,000
Current Debt 0
Non-Cash Working Capital (NCWC) 921,278,000
Change in NCWC 276,856,000
EBIT 353,658,000
Tax Provision 113,771,000
Depreciation and Amortization 111,622,000
Capital Expenditure -72,565,000
Unlevered Free Cash Flow 527,170,319
Current Assets 1,842,750,000
Current Cash 0
Current Liabilities 1,198,328,000
Current Debt 0
Non-Cash Working Capital (NCWC) 644,422,000
Change in NCWC -143,207,000
EBIT 384,830,000
Tax Provision 116,654,000
Depreciation and Amortization 96,845,000
Capital Expenditure -89,648,000
Unlevered Free Cash Flow 96,487,404
Current Assets 1,871,617,000
Current Cash 0
Current Liabilities 1,083,988,000
Current Debt 0
Non-Cash Working Capital (NCWC) 787,629,000
Change in NCWC 120,314,000
EBIT 380,897,000
Tax Provision 109,446,000
Depreciation and Amortization 83,503,000
Capital Expenditure -78,239,000
Unlevered Free Cash Flow 363,367,469
Current Assets 1,840,735,000
Current Cash 0
Current Liabilities 1,173,420,000
Current Debt 0
Non-Cash Working Capital (NCWC) 667,315,000
Change in NCWC -270,333,000
EBIT 327,538,000
Tax Provision 98,673,000
Depreciation and Amortization 71,796,000
Capital Expenditure -54,786,000
Unlevered Free Cash Flow -54,756,739

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