Executives, employees and financial advisors with LPL Financial Holdings Inc. started the week with a bang and rang the electronic bell Monday morning at the NASDAQ in midtown Manhattan to usher in a new day of trading, as well as a celebration: they were there to commemorate LPL Financial’s 15 years since it listed on the NASDAQ to become a public company.
“The IPO fueled investments in technology, talent and services to help advisors grow thriving practices.,” said Rich Steinmeier, LPL’s CEO, this morning during the event.
“Back then, we managed $300 billion in assets, supported 12,000 advisors and had a market cap of roughly $3 billion,” he said. “Today, we are the fastest growing firm in wealth management, with $2.3 trillion in assets, more than 32,000 financial advisors, and a market cap of approximately $30 billion.”
And the largest independent broker-deal has proven to be a growth story, with some missteps along the way. The board fired in 2024 its then CEO and longtime executive, Dan Arnold, for making statements, not yet known publicly, to employees that violated the company’s code of conduct.
He was replaced by Steinmeier, at the time the firm’s chief growth officer.
A glance at the company’s annual earnings per share are an indicator of LPL’s growth.
In 2011, the year after its IPO, LPL Financial reported earnings per share of $1.55, according to its annual reports. Seen years later, earnings had risen to $4.99 per share. Last year, LPL Financial reported earnings of $14.17 per share.
Shares of LPL Financial Holdings Inc. began trading on in November of 2010, with an IPO per share price set at $30.
The company took several years to get its legs under itself; it often seemed mired in compliance, technology and back office mishaps that stemmed from advisors abusive sales practices of expensive products such as nontraded real estate investment trusts and variable annuities.
On Monday morning, shares of LPLA were trading close to $370 for an increase of 918% in 15 years, according to CNBC.com. Over that same period, the S&P 500 has increased 444%.
LPL set the blueprint for a wealth management company to go public in 2005 when its founder, Todd Robinson, sold his 60% stake in the company to two private equity firms, with advisors, employees and executives owned the remaining 40%.
LPL Financial then leveraged up, bought and consolidated aging or unwanted broker-dealers and had its IPO in 2010.
The problem for LPL’s competition is, the financial advice industry so far has not figured out how to replicate LPL’s success as a public company, making it a unicorn.
“LPL is a category killer in the Independent Broker-Deal space, and is unmatched in terms of scale, technology, and - with the recent addition of Commonwealth Financial Network - service levels too,” said Steven Chubak, an analyst with Wolfe Research who has consistently rated the company highly.
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