On Feb 18, Zacks Investment Research upgraded
TD Ameritrade Holding Corporation
) to a Zacks Rank #1 (Strong Buy).
TD AMERITRADE (AMTD): Free Stock Analysis
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Rationale Behind the Upgrade
TD Ameritrade has been witnessing rising earnings estimates aided
by a rise in average client trades per day in January and strong
fiscal first-quarter 2014 results. Moreover, this investment
broker has delivered positive earnings surprises in the past 4
quarters with an average beat of 6.1%. The long-term expected
earnings growth rate for this stock is 20.2%.
In January, client trades per day metrics reached a record high
of 496,000 from 405,000 in the prior month and 387,000 in the
prior-year period. The improvement in trading and investing
business stems from TD Ameritrade's consistent efforts to deliver
enhanced customer services, innovations in online trading,
creative as well as cost-effective marketing and sales.
Improving trading activities will continue to support TD
Ameritrade's earnings in the forthcoming quarter. The same was
reflected in the fiscal first-quarter 2014 results reported on
Jan 21, wherein the company delivered an earning beat driven by
Earnings per share of 35 cents outpaced the Zacks Consensus
Estimate of 32 cents. The bottom line was also higher than the
year-ago quarter figure of 27 cents.
Average client trades per day increased 24% year over year to
413,743. Moreover, TD Ameritrade reported total client assets
worth $596.5 billion, up 24% year over year.
The Zacks Consensus Estimate for fiscal 2014 increased 3.7% to
$1.40 per share over the last 30 days. For fiscal 2015, the
estimate rose 3.1% to $1.67 over the same time frame.
Other Stocks to Consider
Apart from TD Ameritrade, other investment brokers worth
Investment Technology Group Inc.
LPL Financial Holdings Inc.
E*TRADE Financial Corporation
). While Investment Technology Group and LPL Financial carry the
same Zacks Rank as TD Ameritrade, E*TRADE Financial has a Zacks
Rank #2 (Buy).