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S&P Global Ratings upgrades LPL Financial on strong earnings, lower leverage

S&P Global Ratings upgraded LPL Financial Holdings Inc. to BB+ from BB, with a stable outlook on the rating. The ratings agency also upgraded the company's senior secured term loan and revolving credit facility ratings to BB+ from BB and the rating on its unsecured notes to BB from BB-.

S&P Global Ratings said the upgrade was due to the company's strong earnings performance as it continues to scale its business. The ratings agency also lauded LPL Financial's improved capital policy, which is exemplified by its lower debt-to-EBITDA ratio of 1.99x. It expects LPL Financial to continue to repurchase shares and look for M&A deals.

The stable outlook reflects Ratings' expectations that LPL Financial's leverage ratio will maintain between 2.0x and 3.0x over the next 12 months. Despite cash outflows, such as returning capital to shareholders and potential acquisitions, it expects the company to maintain sufficient excess liquidity.

This S&P Global Market Intelligence news article may contain information about credit ratings issued by S&P Global Ratings. Descriptions in this news article were not prepared by S&P Global Ratings.