While many LPL Financial advisors are cheering the broker-dealer's IPO on Thursday, saying it will bring greater visibility for advisors and greater financial flexibility for the firm, some insiders remain skeptical about what the public offering means for its future.
"It gives the independent RIA channel equal status within the rest of the industry," said Bob Fragasso, CEO of Fragasso Financial Advisors in Pittsburgh and a top LPL FA, in a phone interview. "LPL has gotten to the point of scale where they can do this, and it makes them more formidable."
"I see this as a cold-blooded business evaluation – there's nothing wrong with any of it. Everybody wins on this one," added Fragasso, who was expected to sell 23,000 shares Thursday.
Another pleased advisor is Susan Kaplan, head of Kaplan Financial Services in Needham, Mass., which has $960 million in assets under management. It was anticipated that Kaplan would sell roughly 42,000 shares via the IPO.
She sees the move as a "reward for [her] being committed and loyal to LPL" for years, she said in a phone interview. "If there's a diminution in care [from LPL], I would consider moving elsewhere – though I can't really see that happening."
Others advisors, though, are more concerned. "There a level of uncertainty among advisors that the culture might change," said an FA in the Southeast, who's been with LPL for five years and wished to remain anonymous, during a phone interview "Right now, LPL does everything it can to keep us happy – they don't have to answer to shareholders."
But LPL's public presence should make life easier for its advisors, some advisors say. "It will become more of a household name –right now it's a total unknown name…" said an LPL advisor in the Midwest, who's been an FA for more than 30 years and preferred not to identify himself, during a phone interview.
Powerful Momentum
For LPL itself, the move means more financial flexibility and "the ability to have stock and currency for broker acquisitions to build the firm at a much quicker pace," said Donald Weidenfeld, a
