Shares of TD Ameritrade were falling 0.6% to $32.73.
The analyst firm lowered its EPS estimates for the company through 2015. Barclays now expects TD Ameritrade to report earnings of 37 cents a share for the fiscal fourth quarter, down from its previous estimate of 39 cents a share. The firm lowered its EPS estimates for full year 2015 to $1.63 a share, down from $1.67 a share.
Must Read: Warren Buffett's 25 Favorite Stocks
"Earlier today, AMTD reported August metrics," Barclays analyst Kenneth Hill wrote. "While asset trends were overall positive, activity levels came in below our early quarter estimates. DARTs decreased by 6% m/m, likely driven by the seasonal slowdown in August. Total client assets increased 3% on the back of positive market performance during the month."
Separately, TheStreet Ratings team rates TD AMERITRADE HOLDING CORP as a Buy with a ratings score of A. TheStreet Ratings Team has this to say about their recommendation:
"We rate TD AMERITRADE HOLDING CORP (AMTD) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity, expanding profit margins, good cash flow from operations and solid stock price performance. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- AMTD's revenue growth has slightly outpaced the industry average of 3.0%. Since the same quarter one year prior, revenues slightly increased by 5.1%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Capital Markets industry and the overall market, TD AMERITRADE HOLDING CORP's return on equity exceeds that of both the industry average and the S&P 500.
- 47.38% 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 24.86% is above that of the industry average.
- Net operating cash flow has significantly increased by 523.63% to $466.00 million when compared to the same quarter last year. In addition, TD AMERITRADE HOLDING CORP has also vastly surpassed the industry average cash flow growth rate of -89.01%.
- The stock has risen over the past year as investors have generally rewarded the company for its earnings growth and other positive factors like the ones we have cited in this report. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- You can view the full analysis from the report here: AMTD Ratings Report
EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he and Stephanie Link think could be potentially HUGE winners. Click here to see the holdings for FREE.