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LPL Financial on Buyout Spree, Acquires Lucia Securities

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LPL Financial Holdings (LPLA - Free Report) has completed the acquisition of San Diego, CA-based Lucia Securities’ assets. The asset purchase agreement was announced in April.

Lucia Securities, a broker dealer and RIA firm, has more than $15 billion of client assets. These assets are expected to onboard to LPL Financial's platform by year-end.

In addition, all 20 advisors have committed to join LPL Financial and will be doing business as Lucia Capital Group.

LPL Financial continues to expect a transaction multiple of 6 times post-synergy EBITDA.

Rich Steinmeier, LPL Financial managing director and divisional president, Business Development, said “By investing on an ongoing basis in technology and digital capabilities, we strive to help them differentiate their practices in their markets, operate efficient and productive practices, and build businesses with value. We look forward to a long-term partnership with Lucia Capital Group.”

Our Viewpoint

LPL Financial’s inorganic growth efforts are expected to keep supporting the top line. Earlier this week, the company closed the deal to acquire E.K. Riley Investments, LLC’s assets. Last year, it acquired Allen & Company of Florida, while in 2018, it snapped up all outstanding shares of AdvisoryWorld. These deals have positioned LPL Financial well for growth.

Over the past three months, shares of the company have rallied 18.1%, slightly underperforming 18.6% growth recorded by the industry.

Currently, LPL Financial carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

At present, the online brokerage industry is undergoing massive consolidation. In February, major investment bank Morgan Stanley (MS - Free Report) inked a deal to acquire E*Trade Financial . Earlier in November 2019, Charles Schwab’s (SCHW - Free Report) announced a deal to acquire TD Ameritrade Holding for $26 billion, which is likely to create a behemoth in the industry.

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