Comprehensive Stock Comparison
Compare LPL Financial Holdings Inc. (LPLA) vs The Charles Schwab Corporation (SCHW) Stock
Analyze side-by-side fundamentals, valuation, growth, and profitability to decide which stock is the better buy.
Selected Stocks
Add up to 10 tickers. Use presets or search to get started.
Quick Verdict
| Category | Winner | Why |
|---|---|---|
| Growth | LPLA | 37.2% revenue growth vs SCHW's 1.9% |
| Value | LPLA | Lower P/E (12.7x vs 16.2x), PEG 0.95 vs 7.08 |
| Quality / Margins | SCHW | 22.9% net margin vs LPLA's 5.1% |
| Stability / Safety | SCHW | Beta 0.88 vs LPLA's 1.30, lower leverage |
| Dividends | SCHW | 1.3% yield; LPLA pays no meaningful dividend |
| Momentum (1Y) | SCHW | +21.1% vs LPLA's -18.9% |
| Efficiency (ROA) | SCHW | 232.8% ROA vs LPLA's 4.7%, ROIC 6.0% vs 16.1% |
Who Each Stock Is For
Income & stability
Growth exposure
Long-term compounding (10Y)
Sleep-well-at-night portfolio
Valuation efficiency (growth/$)
Defensive / Recession hedge
Business Model
What each company does and how it makes money
LPL Financial operates a comprehensive brokerage and investment advisory platform for independent financial advisors and advisors at financial institutions across the United States. It generates revenue primarily through asset-based fees (roughly 60% of revenue), transaction commissions (about 25%), and cash sweep programs (approximately 15%). The company's key advantage is its massive scale and integrated technology platform that serves over 22,000 advisors—creating significant switching costs and network effects in the independent advisor channel.
Charles Schwab is a major financial services firm that operates as a discount brokerage, wealth manager, and bank for individual investors and financial advisors. It generates revenue primarily from net interest income on client cash balances (roughly 50%), asset management fees on its proprietary funds and advisory services, and trading commissions. The company's key competitive advantage is its massive scale in client assets—over $8 trillion—which creates a powerful network effect and allows it to offer low-cost services while maintaining profitability.
Revenue Breakdown by Segment
How each company's revenue is distributed across its business units
Financial Metrics Comparison
Side-by-side fundamentals across 2 stocks. BestLagging
Financial Scorecard
SCHW leads in 4 of 6 categories (Financial Metrics, Profitability & Efficiency). LPLA leads in 2 (Valuation Metrics, Analyst Outlook).
Financial Metrics (TTM)
SCHW is the larger business by revenue, generating $26.0B annually — 1.5x LPLA's $17.0B. SCHW is the more profitable business, keeping 22.9% of every revenue dollar as net income compared to LPLA's 5.1%.
| Metric | LPLALPL Financial Hol… | SCHWThe Charles Schwa… |
|---|---|---|
| RevenueTrailing 12 months | $17.0B | $26.0B |
| EBITDAEarnings before interest/tax | $2.3B | $12.8B |
| Net IncomeAfter-tax profit | $863M | $8.9B |
| Free Cash FlowCash after capex | -$1.6B | $9.7B |
| Gross MarginGross profit ÷ Revenue | +25.6% | +75.4% |
| Operating MarginEBIT ÷ Revenue | +13.4% | +29.6% |
| Net MarginNet income ÷ Revenue | +5.1% | +22.9% |
| FCF MarginFCF ÷ Revenue | — | +7.9% |
| Rev. Growth (YoY)Latest quarter vs prior year | — | — |
| EPS Growth (YoY)Latest quarter vs prior year | +4.2% | +41.5% |
Valuation Metrics
At 27.5x trailing earnings, LPLA trades at a 14% valuation discount to SCHW's 31.8x P/E. Adjusting for growth (PEG ratio), LPLA offers better value at 2.07x vs SCHW's 13.91x — a lower PEG means you pay less per unit of expected earnings growth.
| Metric | LPLALPL Financial Hol… | SCHWThe Charles Schwa… |
|---|---|---|
| Market CapShares × price | $24.0B | $169.2B |
| Enterprise ValueMkt cap + debt − cash | $30.3B | $172.2B |
| Trailing P/EPrice ÷ TTM EPS | 27.51x | 31.84x |
| Forward P/EPrice ÷ next-FY EPS est. | 12.65x | 16.22x |
| PEG RatioP/E ÷ EPS growth rate | 2.07x | 13.91x |
| EV / EBITDAEnterprise value multiple | 10.38x | 18.87x |
| Price / SalesMarket cap ÷ Revenue | 1.42x | 6.51x |
| Price / BookPrice ÷ Book value/share | 4.44x | 3.61x |
| Price / FCFMarket cap ÷ FCF | — | 82.52x |
Profitability & Efficiency
SCHW delivers a 2.9% return on equity — every $100 of shareholder capital generates $3 in annual profit, vs $16 for LPLA. SCHW carries lower financial leverage with a 0.93x debt-to-equity ratio, signaling a more conservative balance sheet compared to LPLA's 1.36x. On the Piotroski fundamental quality scale (0–9), SCHW scores 7/9 vs LPLA's 2/9, reflecting strong financial health.
| Metric | LPLALPL Financial Hol… | SCHWThe Charles Schwa… |
|---|---|---|
| ROE (TTM)Return on equity | +16.1% | +2.9% |
| ROA (TTM)Return on assets | +4.7% | +2.3% |
| ROICReturn on invested capital | +16.1% | +6.0% |
| ROCEReturn on capital employed | +19.1% | +9.5% |
| Piotroski ScoreFundamental quality 0–9 | 2 | 7 |
| Debt / EquityFinancial leverage | 1.36x | 0.93x |
| Net DebtTotal debt minus cash | $4.2B | $3.1B |
| Cash & Equiv.Liquid assets | $1.0B | $42.1B |
| Total DebtShort + long-term debt | $7.3B | $45.1B |
| Interest CoverageEBIT ÷ Interest expense | 3.85x | 3.05x |
Total Returns (with DRIP)
A $10,000 investment in LPLA five years ago would be worth $22,612 today (with dividends reinvested), compared to $15,597 for SCHW. Over the past 12 months, SCHW leads with a +21.1% total return vs LPLA's -18.9%. The 3-year compound annual growth rate (CAGR) favors SCHW at 8.1% vs LPLA's 6.8% — a key indicator of consistent wealth creation.
| Metric | LPLALPL Financial Hol… | SCHWThe Charles Schwa… |
|---|---|---|
| YTD ReturnYear-to-date | -16.9% | -6.0% |
| 1-Year ReturnPast 12 months | -18.9% | +21.1% |
| 3-Year ReturnCumulative with dividends | +21.8% | +26.2% |
| 5-Year ReturnCumulative with dividends | +126.1% | +56.0% |
| 10-Year ReturnCumulative with dividends | +1437.2% | +309.4% |
| CAGR (3Y)Annualised 3-year return | +6.8% | +8.1% |
Risk & Volatility
SCHW is the less volatile stock with a 0.88 beta — it tends to amplify market swings less than LPLA's 1.30 beta. A beta below 1.0 means the stock typically moves less than the S&P 500. SCHW currently trades 88.6% from its 52-week high vs LPLA's 74.4% drawdown — a narrower gap to the peak suggests stronger recent price momentum.
| Metric | LPLALPL Financial Hol… | SCHWThe Charles Schwa… |
|---|---|---|
| Beta (5Y)Sensitivity to S&P 500 | 1.30x | 0.88x |
| 52-Week HighHighest price in past year | $403.58 | $107.50 |
| 52-Week LowLowest price in past year | $262.83 | $65.88 |
| % of 52W HighCurrent price vs 52-week peak | +74.4% | +88.6% |
| RSI (14)Momentum oscillator 0–100 | 38.5 | 48.7 |
| Avg Volume (50D)Average daily shares traded | 712K | 9.0M |
Analyst Outlook
Wall Street rates LPLA as "Buy" and SCHW as "Buy". Consensus price targets imply 52.9% upside for LPLA (target: $459) vs 29.0% for SCHW (target: $123). SCHW is the only dividend payer here at 1.30% yield — a key consideration for income-focused portfolios.
| Metric | LPLALPL Financial Hol… | SCHWThe Charles Schwa… |
|---|---|---|
| Analyst RatingConsensus buy/hold/sell | Buy | Buy |
| Price TargetConsensus 12-month target | $459.17 | $122.78 |
| # AnalystsCovering analysts | 22 | 50 |
| Dividend YieldAnnual dividend ÷ price | — | +1.3% |
| Dividend StreakConsecutive years of raises | 3 | 0 |
| Dividend / ShareAnnual DPS | — | $1.24 |
| Buyback YieldShare repurchases ÷ mkt cap | 0.0% | 0.0% |
Historical Charts
Charts are rendered on first load. Hover for details.
Chart 1Total Return — 5 Years (Rebased to 100)
| Stock | Mar 20 | Feb 26 | Change |
|---|---|---|---|
| LPL Financial Holdi… (LPLA) | 100 | 456.16 | +356.2% |
| The Charles Schwab … (SCHW) | 100 | 250.52 | +150.5% |
LPL Financial Holdi… (LPLA) returned +126% over 5 years vs The Charles Schwab … (SCHW)'s +56%. A $10,000 investment in LPLA 5 years ago would be worth $22,612 today (including dividends reinvested).
Chart 2Revenue Growth — 10 Years
| Stock | 2016 | 2025 | Change |
|---|---|---|---|
| LPL Financial Holdi… (LPLA) | $4.0B | $17.0B | +319.6% |
| The Charles Schwab … (SCHW) | $7.6B | $26.0B | +239.9% |
LPL Financial Holdings Inc.'s revenue grew from $4.0B (2016) to $17.0B (2025) — a 17.3% CAGR.
Chart 3Net Margin Trend — 10 Years
| Stock | 2016 | 2025 | Change |
|---|---|---|---|
| LPL Financial Holdi… (LPLA) | 4.7% | 5.1% | +7.2% |
| The Charles Schwab … (SCHW) | 24.7% | 22.9% | -7.5% |
LPL Financial Holdings Inc.'s net margin went from 5% (2016) to 5% (2025).
Chart 4P/E Ratio History — 9 Years
| Stock | 2017 | 2025 | Change |
|---|---|---|---|
| LPL Financial Holdi… (LPLA) | 22.1 | 32.7 | +48.0% |
| The Charles Schwab … (SCHW) | 31.9 | 24.8 | -22.3% |
LPL Financial Holdings Inc. has traded in a 13x–33x P/E range over 9 years; current trailing P/E is ~28x. The Charles Schwab Corporation has traded in a 17x–32x P/E range over 8 years; current trailing P/E is ~32x.
Chart 5EPS Growth — 10 Years
| Stock | 2016 | 2025 | Change |
|---|---|---|---|
| LPL Financial Holdi… (LPLA) | 2.13 | 10.92 | +412.7% |
| The Charles Schwab … (SCHW) | 1.31 | 2.99 | +128.2% |
LPL Financial Holdings Inc.'s EPS grew from $2.13 (2016) to $10.92 (2025) — a 20% CAGR.
Chart 6Free Cash Flow — 5 Years
LPL Financial Holdings Inc. generated $0M FCF in 2025 (-100% vs 2021). The Charles Schwab Corporation generated $2B FCF in 2024 (+71% vs 2021).
LPLA vs SCHW: Frequently Asked Questions
9 questions · data-driven answers · updated daily
01Is LPLA or SCHW a better buy right now?
LPL Financial Holdings Inc. (LPLA) offers the better valuation at 27.5x trailing P/E (12.7x forward), making it the more compelling value choice. Analysts rate LPL Financial Holdings Inc. (LPLA) a "Buy" — based on 22 analyst ratings — the highest consensus in this comparison. The "better buy" depends entirely on your goals: growth investors should weight revenue trajectory, value investors should weight P/E and PEG, and income investors should weight dividend yield and streak.
02Which has the better valuation — LPLA or SCHW?
On trailing P/E, LPL Financial Holdings Inc. (LPLA) is the cheapest at 27.5x versus The Charles Schwab Corporation at 31.8x. On forward P/E, LPL Financial Holdings Inc. is actually cheaper at 12.7x. The PEG ratio (P/E divided by earnings growth rate) is the most growth-adjusted single valuation metric: LPL Financial Holdings Inc. wins at 0.95x versus The Charles Schwab Corporation's 7.08x — a PEG below 1.0 traditionally signals the market is underpricing earnings growth.
03Which is the better long-term investment — LPLA or SCHW?
Over the past 5 years, LPL Financial Holdings Inc. (LPLA) delivered a total return of +126.1%, compared to +56.0% for The Charles Schwab Corporation (SCHW). A $10,000 investment in LPLA five years ago would be worth approximately $23K today (assuming dividends reinvested). Over 10 years, the gap is even starker: LPLA returned +1437% versus SCHW's +309.4%. Past returns do not guarantee future results, and the stock with the higher historical return may already have its best growth priced in.
04Which is safer — LPLA or SCHW?
By beta (market sensitivity over 5 years), The Charles Schwab Corporation (SCHW) is the lower-risk stock at 0.88β versus LPL Financial Holdings Inc.'s 1.30β — meaning LPLA is approximately 48% more volatile than SCHW relative to the S&P 500. On balance sheet safety, The Charles Schwab Corporation (SCHW) carries a lower debt/equity ratio of 93% versus 136% for LPL Financial Holdings Inc. — giving it more financial flexibility in a downturn.
05Which has better profit margins — LPLA or SCHW?
The Charles Schwab Corporation (SCHW) is the more profitable company, earning 22.9% net margin versus 5.1% for LPL Financial Holdings Inc. — meaning it keeps 22.9% of every revenue dollar as bottom-line profit. Operating margin tells a similar story: SCHW leads at 29.6% versus 13.4% for LPLA. At the gross margin level — before operating expenses — SCHW leads at 75.4%, reflecting greater pricing power or product mix advantage. Stronger margins indicate durable pricing power, lower cost of revenue, or higher mix of software/services. They are one of the clearest signs of business quality.
06Is LPLA or SCHW more undervalued right now?
The PEG ratio (forward P/E divided by expected earnings growth rate) is the most precise measure of undervaluation relative to growth potential. By this metric, LPL Financial Holdings Inc. (LPLA) is the more undervalued stock at a PEG of 0.95x versus The Charles Schwab Corporation's 7.08x. A PEG below 1.0 is traditionally considered the threshold for growth-adjusted undervaluation. On forward earnings alone, LPL Financial Holdings Inc. (LPLA) trades at 12.7x forward P/E versus 16.2x for The Charles Schwab Corporation — 3.6x cheaper on a one-year earnings basis. Analyst consensus price targets imply the most upside for LPLA: 52.9% to $459.17.
07Which pays a better dividend — LPLA or SCHW?
In this comparison, SCHW (1.3% yield) pays a dividend. LPLA does not pay a meaningful dividend and should not be held primarily for income.
08Is LPLA or SCHW better for a retirement portfolio?
For long-horizon retirement investors, The Charles Schwab Corporation (SCHW) is the stronger choice — it scores higher on the combination of lower volatility, dividend reliability, and long-term compounding (low volatility (β 0.88), 1.3% yield, +309.4% 10Y return). Both have compounded well over 10 years (SCHW: +309.4%, LPLA: +1437%), confirming both are viable long-term holds — but the lower-volatility option typically results in less emotional selling during corrections. Retirement portfolios generally favour predictability over maximum returns. Consult a financial advisor before making allocation decisions.
09What are the main differences between LPLA and SCHW?
Both stocks operate in the Financial Services sector, making this a peer-level intra-sector comparison — the same macro tailwinds and headwinds will affect both. SCHW pays a dividend while LPLA does not, making them suitable for different income and tax situations. These fundamental differences mean investors should not choose between them on a single metric — the "better stock" depends entirely on which of these characteristics aligns with your investment strategy.
Find Stocks Like These
Explore pre-built screens for each stock's profile, or build a custom screen to find stocks that beat both.