LPL Financial Brokerage & Advisory Assets Fall Sequentially

LPL Financial Holdings Inc.’s (NASDAQ:LPLA) total brokerage and advisory assets of $699.3 billion at the end of May 2019 declined 3.1% sequentially but improved 2.7% year over year. Of the total brokerage and advisory assets, brokerage assets were $366 billion while advisory assets totaled $311.3 billion.

Further, total net new assets were an inflow of $1.4 billion in April. This included $0.4 billion of outflows from a large hybrid firm. Prior to these outflows, total net new assets were an inflow of $1.8 billion.

LPL Financial reported $29.8 billion of total client cash sweep balances, up nearly 1% from April 2019 and 4.2% from May 2018. Of the total, $20.9 billion was insured cash and $4.2 billion was deposit cash while the remaining $4.7 billion was money market balance.

With the dismal equity markets performance, trading activities are not likely to improve. This, in turn, will have an adverse impact on revenues.

Shares of LPL Financial have rallied 33.6% so far this year, outperforming 5.6% rise for the industry.

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

Performance of Other Investment Brokers

E*TRADE Financial’s (NASDAQ:ETFC) Daily Average Revenue Trades (DARTs) for May 2019 were 279,058, up 2% from the previous month and 14% year over year. Derivatives comprised 33% of DARTs in May.

Interactive Brokers Group, Inc. (NYSE:IBKR) released its Electronic Brokerage segment’s performance metrics for May. The segment, which deals with the clearance and settlement of trades for individual and institutional clients globally, reported a year-over-year and sequential decrease in DARTs. Total client DARTs were 894,000, up 15% from April 2019 and from May 2018.

Charles Schwab (NYSE:SCHW) reported monthly activity for May 2019. Total client assets came in at $3.5 trillion, down 4% from the prior month but up 5% from the year-ago month. Client assets receiving ongoing advisory services were $1.85 trillion, down 3% sequentially but up 5% year over year.

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