Think Hargreaves Lansdown’s share price is a bargain? Read this now
The company has grown from a two-man operation into one of the largest financial institutions in the UK, managing tens of billions of pounds for UK investors. Investors have been well rewarded and more than happy to pay a premium for shares in the business. However, at the end of September, its expansion hit a stumbling block. The biggest the sticking point for me is Hargreaves Lansdown’s current valuation. Even after losing nearly a fifth of its value, the stock is still changing hands for 32 times estimated 2019 earnings. Financial markets will always be a critical part of the global economy. As the LSE operates some of the biggest markets in Europe, it should have no problem generating a steady revenue for many years to come. And unlike Hargreaves Landsdown, which generally reports a slowdown when markets are volatile as investors take to the sidelines, volatility is excellent news for the LSE as it means more trading.