Online brokerage firm,
) reported an upsurge in its Daily Average Revenue Trades (DARTs)
for Jul 2014. According to the monthly market activity report for
July, E*TRADE's DARTs were 153,671, up 5% from the prior month and
9% on a year-over-year basis.
Broker performance is generally measured through DARTs that
represent the number of trades from which brokers can expect
commissions or fees. The rise in DARTs largely resulted from the
gradual economic recovery and investors' keenness to invest in the
At the end of the month under review, E*TRADE's total number of
accounts came in at approximately 4.7 million, of which about 3.1
million are brokerage accounts, 1.2 million are stock plan accounts
and 0.4 million are banking accounts.
For the reported month, E*TRADE's total brokerage accounts included
29,655 gross new brokerage accounts. Moreover, E*TRADE's net new
brokerage assets were $0.4 billion, decreasing from $0.5 billion in
the prior month. Total brokerage accounts reflect the company's
ability to attract and retain customers who trade and invest.
As of July-end, E*TRADE's customer security holdings were $195.5
billion, down 1.2% from the prior month. The company's
brokerage-related cash remained flat at $40 billion, with customers
being the net buyers of about $0.7 billion in securities. Moreover,
bank-related cash and deposits for the company stood at $5.9
billion, down $0.1 billion from the prior month.
Concurrently, another firm, The
) reported its monthly metrics for Jul 2014. The company reported
Daily Average Trades (DATs) of 458,000. This marked a decrease of
2% from the prior month and 8% from the year-ago month.
Last week, another brokerage firm,
Holding Corp. (
) came out with its average client trades per day of 405,000 in its
activity report for Jul 2014. This figure increased 8% from the
prior month and 9% year over year.
Amid the challenging economy, increase in DARTs and new brokerage
accounts will be beneficial for the company. We remain concerned
about the sluggish macroeconomic environment, which might lead to
lower trading activities. Moreover, fluctuating interest rates are
expected to continuously impact the company's financials in the
However, E*TRADE's initiatives to reduce balance sheet risk appear
to be promising, although they will put near-term pressure on the
net interest margin. The company's strong capital position is
impressive and will likely aid it to navigate through the current
E*TRADE currently carries a Zacks Rank #3 (Hold). A better
performing stock in the same industry includes Piper Jaffray
) with a Zacks Rank #1 (Strong Buy).
Want the latest recommendations from Zacks Investment Research?
Today, you can download 7 Best Stocks for the Next 30 Days.
Click to get this free report
E TRADE FINL CP (ETFC): Free Stock Analysis
SCHWAB(CHAS) (SCHW): Free Stock Analysis Report
TD AMERITRADE (AMTD): Free Stock Analysis
PIPER JAFFRAY (PJC): Free Stock Analysis Report
To read this article on Zacks.com click here.