NEW YORK (
) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, growth in earnings per share, increase in net income and expanding profit margins. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.
Highlights from the ratings report include:
- The revenue growth came in higher than the industry average of 12.3%. Since the same quarter one year prior, revenues rose by 15.5%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- The current debt-to-equity ratio, 0.32, is low and is below the industry average, implying that there has been successful management of debt levels.
- TD AMERITRADE HOLDING CORP has improved earnings per share by 45.0% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, TD AMERITRADE HOLDING CORP increased its bottom line by earning $1.11 versus $1.00 in the prior year. This year, the market expects an improvement in earnings ($1.18 versus $1.11).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Capital Markets industry. The net income increased by 43.6% when compared to the same quarter one year prior, rising from $113.96 million to $163.65 million.
- 44.00% is the gross profit margin for TD AMERITRADE HOLDING CORP which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 23.20% significantly outperformed against the industry average.
TD Ameritrade Holding Corporation, through its subsidiaries, provides securities brokerage services and technology-based financial services to retail investors, traders, and independent registered investment advisors (RIA) in the United States. The company has a P/E ratio of 15.9, equal to the average financial services industry P/E ratio and below the S&P 500 P/E ratio of 17.7. TD Ameritrade Holding has a market cap of $9.2 billion and is part of the
industry. Shares are down 17.4% year to date as of the close of trading on Wednesday.
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