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LPL Financial (LPLA) Witnesses Improvement in May Metrics

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LPL Financial Holdings Inc.’s (LPLA - Free Report) activity report for May 2018 reflects improvement from the prior month. The figures in the reported month include assets from its acquisition of the broker/dealer network of National Planning Holdings, Inc.

Notably, the company projects total asset transfer from National Planning Holdings to be $70-$75 billion, driven by more direct business assets joining its platform.

LPL Financial recorded total brokerage and advisory assets of $659.5 billion at the end of May, up 1.1% from the previous month. Of the total brokerage and advisory assets, brokerage assets were $369.2 billion, while advisory assets came in at $290.3 billion. Excluding National Planning Holdings, total brokerage and advisory assets increased 1.2% from April 2018 to $587 billion.

LPL Financial reported $28.6 billion of total client cash sweep balances for May, down 1% from April. Of the total, $21.8 billion was insured cash, $4.0 billion was deposit cash, while the remaining $2.8 billion was money market cash balance.

With the gradual stabilization of equity markets, trading activities are anticipated to improve further. While dismal top-line growth remains a near-term concern, LPL Financial’s efforts to extend its offerings to all affiliated advisors are expected to help the company gain greater market share.

LPL Financial currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The company’s share price movement reflects investors’ optimism as the stock has rallied 71.7% over the past year, outperforming 21% growth registered by the industry.

Performance of Other Investment Brokers

Interactive Brokers Group’s (IBKR - Free Report) Electronic Brokerage segment, which deals with clearance and settlement of trades for individual and institutional clients globally, has reported a year-over-year increase in Daily Average Revenue Trades (DARTs) for May 2018. Total client DARTs were 780,000, increasing 16% from May 2017, but down 4% from April 2017.

E*TRADE Financial (ETFC - Free Report) reported a rise in DARTs for May 2018. According to its monthly market activity, the company’s DARTs came in at 253,649, up 1% from the prior month and 20% year over year. Notably, derivatives comprised 34% of DARTs in May.

The Charles Schwab Corporation’s (SCHW - Free Report) activity report for May reflects a year-over-year improvement. Total client assets were $3.4 trillion at the end of the month, increasing 13% from the year-ago quarter. Further, client assets receiving ongoing advisory services were $1.8 trillion, up 15% year over year.

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