Reviewing Morgan Stanley (MS)’s and LPL Financial Holdings Inc. (NASDAQ:LPLA)’s results

Both Morgan Stanley (NYSE:MS) and LPL Financial Holdings Inc. (NASDAQ:LPLA) are Investment Brokerage – National companies, competing one another. We will compare their risk, analyst recommendations, profitability, dividends, earnings and valuation, institutional ownership.

Valuation and Earnings

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Morgan Stanley 39.32B 1.89 7.98B 4.84 8.68
LPL Financial Holdings Inc. 5.32B 1.25 501.33M 4.86 15.62

Demonstrates Morgan Stanley and LPL Financial Holdings Inc. earnings per share, gross revenue and valuation. LPL Financial Holdings Inc. has lower revenue, but higher earnings than Morgan Stanley. The business with the lower P/E out of the two companies is considered for more affordable of the two firms presently. Morgan Stanley’s presently lower P/E ratio makes it the more affordable of the two businesses.

Profitability

Table 2 has Morgan Stanley and LPL Financial Holdings Inc.’s return on equity, net margins and return on assets.

Net Margins Return on Equity Return on Assets
Morgan Stanley 20.30% 11.7% 1%
LPL Financial Holdings Inc. 9.42% 44.3% 8.2%

Volatility & Risk

Morgan Stanley’s current beta is 1.19 and it happens to be 19.00% more volatile than Standard & Poor’s 500. In other hand, LPL Financial Holdings Inc. has beta of 1.62 which is 62.00% more volatile than Standard & Poor’s 500.

Dividends

Morgan Stanley pays out $1.2 per share annually while its annual dividend yield is 2.59%. LPL Financial Holdings Inc. offers an annual dividend of $1 per share, bundled with 1.21% dividend yield.

Analyst Recommendations

In next table is given Morgan Stanley and LPL Financial Holdings Inc.’s ratings and recommendations.

Sell Ratings Hold Ratings Buy Ratings Rating Score
Morgan Stanley 1 0 2 2.67
LPL Financial Holdings Inc. 0 2 2 2.50

Morgan Stanley’s upside potential currently stands at 24.49% and an $55 average target price. Meanwhile, LPL Financial Holdings Inc.’s average target price is $78.4, while its potential downside is -1.73%. The results from earlier shows that analysts belief suggest that Morgan Stanley seems more appealing than LPL Financial Holdings Inc.

Insider and Institutional Ownership

Institutional investors owned 61.9% of Morgan Stanley shares and 94% of LPL Financial Holdings Inc. shares. Morgan Stanley’s share owned by insiders are 24.1%. Comparatively, LPL Financial Holdings Inc. has 0.8% of it’s share owned by insiders.

Performance

Here are the Weekly, Monthly, Quarterly, Half Yearly, Yearly and YTD Performance of both pretenders.

Performance (W) Performance (M) Performance (Q) Performance (HY) Performance (Y) Performance (YTD)
Morgan Stanley -0.45% -0.71% -7.31% -15.92% -22.92% 5.93%
LPL Financial Holdings Inc. -2.13% 7.83% 17.64% 13.37% 20.44% 24.23%

For the past year Morgan Stanley was less bullish than LPL Financial Holdings Inc.

Summary

On 10 of the 16 factors Morgan Stanley beats LPL Financial Holdings Inc.

Morgan Stanley, a financial holding company, provides various financial products and services to corporations, governments, financial institutions, and individuals in the Americas, Europe, the Middle East, Africa, and the Asia-Pacific. The companyÂ’s Institutional Securities segment offers capital raising and financial advisory services, including services related to the underwriting of debt, equity, and other securities, as well as advice on mergers and acquisitions, restructurings, real estate, and project finance. This segment also provides sales and trading services, such as sales, financing, and market-making services in equity securities and fixed income products, including foreign exchange and commodities, as well as prime brokerage services; corporate loans, commercial and residential mortgage lending, and asset-backed lending; financing for equities and commodities customers; loans to municipalities; and investments and research services. Its Wealth Management segment offers various financial services and solutions covering brokerage and investment advisory services, financial and wealth planning services, annuity and insurance products, credit and other lending products, and banking and retirement plan services to individual investors, small-to-medium sized businesses, and institutions. The companyÂ’s Investment Management segment provides various investment strategies and products comprising equity, fixed income, liquidity, and alternative/other products, as well as managed futures products to a group of clients across institutional and intermediary channels. Morgan Stanley was founded in 1924 and is headquartered in New York, New York.

LPL Financial Holdings Inc., together with its subsidiaries, provides an integrated platform of brokerage and investment advisory services to independent financial advisors in the United States. Its brokerage offerings include variable and fixed annuities, mutual funds, equities, alternative investments such as non-traded real estate investment trusts and business development companies, retirement and 529 education savings plans, fixed income, and insurance. The companyÂ’s fee-based platforms provide access to mutual funds, exchange-traded funds, stocks, bonds, certain option strategies, unit investment trusts, and institutional money managers and no-load multi-manager variable annuities. In addition, it offers cash sweep programs; and retirement solution, a commission and fee-based service that allows advisors to provide brokerage services, consultation, and advice to plan sponsors. Further, the company provides other services comprising tools and services that enable advisors to maintain and grow their practices; and custodial services to trusts for estates and families. It offers its services to approximately 14,000 independent financial advisors, including financial advisors at approximately 700 financial institutions. The company was formerly known as LPL Investment Holdings Inc. and changed its name to LPL Financial Holdings Inc. in June 2012. LPL Financial Holdings Inc. was founded in 1968 and is based in Boston, Massachusetts.

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