Ameriprise Financial vs LPL Financial Which Is More Profitable?

Ameriprise Financial and LPL Financial are two leading financial firms in the United States, both offering investment services, financial planning, and wealth management solutions to their clients. While Ameriprise Financial has a long history dating back to 1894 and a well-established reputation in the industry, LPL Financial is known for its extensive network of independent financial advisors. Investors looking to invest in these stocks should consider factors such as the companies' financial performance, growth potential, and industry trends.

Ameriprise Financial or LPL Financial?

When comparing Ameriprise Financial and LPL Financial, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Ameriprise Financial and LPL Financial.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Ameriprise Financial has a dividend yield of 1.05%, while LPL Financial has a dividend yield of 0.36%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Ameriprise Financial reports a 5-year dividend growth of 8.47% year and a payout ratio of 20.91%. On the other hand, LPL Financial reports a 5-year dividend growth of 3.71% year and a payout ratio of 8.94%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Ameriprise Financial P/E ratio at 20.39 and LPL Financial's P/E ratio at 24.56. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Ameriprise Financial P/B ratio is 9.66 while LPL Financial's P/B ratio is 8.91.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Ameriprise Financial has seen a 5-year revenue growth of 0.82%, while LPL Financial's is 5.33%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Ameriprise Financial's ROE at 53.30% and LPL Financial's ROE at 41.74%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $546.91 for Ameriprise Financial and $327.84 for LPL Financial. Over the past year, Ameriprise Financial's prices ranged from $368.41 to $577.00, with a yearly change of 56.62%. LPL Financial's prices fluctuated between $187.19 and $334.38, with a yearly change of 78.63%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.