Comparing LPL Financial (NASDAQ:LPLA) & MarketWise (NASDAQ:MKTW)

LPL Financial (NASDAQ:LPLA) and MarketWise (NASDAQ:MKTW) are both finance companies, but which is the better business? We will compare the two businesses based on the strength of their analyst recommendations, risk, earnings, dividends, institutional ownership, profitability and valuation.

Profitability

This table compares LPL Financial and MarketWise’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
LPL Financial	N/A	N/A	N/A
MarketWise	N/A	N/A	N/A

Institutional and Insider Ownership

95.7% of LPL Financial shares are owned by institutional investors. Comparatively, 23.0% of MarketWise shares are owned by institutional investors. 0.6% of LPL Financial shares are owned by company insiders. Comparatively, 29.9% of MarketWise shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for LPL Financial and MarketWise, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
LPL Financial	0	3	14	0	2.82
MarketWise	0	1	1	0	2.50

LPL Financial currently has a consensus price target of $407.19, suggesting a potential upside of 28.22%. Given LPL Financial’s stronger consensus rating and higher possible upside, research analysts plainly believe LPL Financial is more favorable than MarketWise.

Valuation and Earnings

This table compares LPL Financial and MarketWise”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
LPL Financial	$19.61 billion	1.28	$987.42 million	$12.54	25.32
MarketWise	N/A	N/A	N/A	$0.88	22.39

LPL Financial has higher revenue and earnings than MarketWise. MarketWise is trading at a lower price-to-earnings ratio than LPL Financial, indicating that it is currently the more affordable of the two stocks.

Summary

LPL Financial beats MarketWise on 7 of the 8 factors compared between the two stocks.

About LPL Financial

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 enterprises in the United States. Its brokerage offerings include variable and fixed annuities, mutual funds, equities, fixed income, alternative investments, retirement and 529 education savings plans, and insurance. The company also provides fee-based platforms that 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 money market products; and retirement solutions for commission-and fee-based services that allow advisors to provide brokerage services, consultation, and advice to retirement plan sponsors. Further, the company provides other services comprising tools and services that enable advisors to maintain and grow their practices; trust, investment management oversight, and custodial services for estates and families, as well as insurance brokerage general agency services; and technology products, such as proposal generation, investment analytics, and portfolio modeling. 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 1989 and is based in San Diego, California.

About MarketWise

MarketWise, Inc. operates a content and technology multi-brand platform for self-directed investors in the United States and Internationally. Its platform includes subscription businesses that provides financial research, software, education, and tools to navigate the financial markets. The company offers various investment strategies, such as value investing, income, growth, commodities, cryptocurrencies, venture, crowdfunded investing, biotechnology, mutual funds, options, and trading; investment research product portfolio through a range of media, including desktops, laptops, tablets, and mobile; and financial newsletters. It provides a suite of stock research tools and portfolio management services under the Chaikin Analytics brand; portfolio management software tools under the TradeSmith brand name; and database of accounting-based financial summaries under the Altimetry brand. In addition, the company develops screeners, monitors, portfolio management tools, and proprietary indicators that produce a composite score to rank publicly traded companies. The company was founded in 1999 and is headquartered in Baltimore, Maryland.