Trade-Ideas LLC identified

LPL Financial Holdings

(

LPLA

) as a "barbarian at the gate" (strong stocks crossing above resistance with today's range greater than 200%) candidate. In addition to specific proprietary factors, Trade-Ideas identified LPL Financial Holdings as such a stock due to the following factors:

  • LPLA has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $29.0 million.
  • LPLA has traded 532,459 shares today.
  • LPLA traded in a range 221.2% of the normal price range with a price range of $2.08.
  • LPLA traded above its daily resistance level (quality: 31 days, meaning that the stock is crossing a resistance level set by the last 31 calendar days. The resistance price is defined by the Price - $0.01 at the time of the signal).

Stocks matching the 'Barbarian at the Gate' criteria are worthwhile stocks to watch for a variety of factors including historical back testing and volatility. Trade-Ideas targets these opportunities because the stock is exhibiting an unusual behavior while displaying positive price action. In this case, the stock crossed an important inflection point; namely, 'resistance' while at the same time the range of the stock's movement in price is more than twice its normal size. This large range foreshadows a possible continuation as the stock moves higher.

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More details on LPLA:

LPL Financial Holdings Inc., together with its subsidiaries, provides an integrated platform of brokerage and investment advisory services to independent financial advisors and financial advisors at financial institutions in the United States. The stock currently has a dividend yield of 2.6%. LPLA has a PE ratio of 21. Currently there are 2 analysts that rate LPL Financial Holdings a buy, 1 analyst rates it a sell, and 2 rate it a hold.

The average volume for LPL Financial Holdings has been 841,600 shares per day over the past 30 days. LPL Financial has a market cap of $3.7 billion and is part of the financial sector and financial services industry. The stock has a beta of 1.06 and a short float of 18.5% with 21.80 days to cover. Shares are down 9.8% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates LPL Financial Holdings as a

buy

. The company's strengths can be seen in multiple areas, such as its growth in earnings per share, increase in net income, notable return on equity and good cash flow from operations. We feel its strengths outweigh the fact that the company has had lackluster performance in the stock itself.

Highlights from the ratings report include:

  • LPL FINANCIAL HOLDINGS INC has improved earnings per share by 23.8% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, LPL FINANCIAL HOLDINGS INC increased its bottom line by earning $1.75 versus $1.72 in the prior year. This year, the market expects an improvement in earnings ($2.47 versus $1.75).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Capital Markets industry. The net income increased by 16.6% when compared to the same quarter one year prior, going from $43.09 million to $50.24 million.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Capital Markets industry and the overall market, LPL FINANCIAL HOLDINGS INC's return on equity exceeds that of both the industry average and the S&P 500.
  • Net operating cash flow has significantly increased by 330.25% to $132.06 million when compared to the same quarter last year. In addition, LPL FINANCIAL HOLDINGS INC has also vastly surpassed the industry average cash flow growth rate of -425.92%.
  • LPLA, with its decline in revenue, slightly underperformed the industry average of 6.7%. Since the same quarter one year prior, revenues slightly dropped by 0.2%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.

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