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TD Ameritrade earnings drop

By Mike Martinez for CEOWORLD Magazine Updated:October 27, 2009

TD AMERITRADE Holding Corporation (NASDAQ: AMTD) has released results for fiscal 2009. Despite facing challenges related to struggling stock markets, a near-zero interest rate environment and an economic recession, the Company delivered a strong financial performance as a result of record organic growth in client assets and trading activity.

On Ameritrade’s conference call, it said it is continuing to see strong trends in the marketplace. Also, AMTD said it is considering share buybacks and a dividend.

TD Ameritrade posted a profit of 26 cents a share, down from 29 cents a share, a year earlier versus 22 cents. Average client trades a day were up 35% on the year and 4.9% sequentially amid the stock market’s continued rally.

Profit for the fiscal fourth quarter decreased to $156.7 million, or 26 cents a share, from $172 million, or 29 cents, a year earlier, the Omaha, Nebraska-based company said in a statement today. Earnings beat the 24-cent average analyst estimate, according to data compiled by Bloomberg. TD Ameritrade also forecast 2010 profit of $1.10 to $1.40 a share, compared with the average projection of $1.30.

TD Ameritrade waived fees on some money-market funds after the Federal Reserve slashed its benchmark interest rate to near zero in December. That offset revenue gains from an increase in trading, spurred by the biggest rally in U.S. stocks since the 1930s. Chief Executive Officer Fred Tomczyk is trying to boost commissions with the $748.6 million purchase of options brokerage Thinkorswim Group Inc. following four consecutive quarters of declining profit.

AMTD expects EPS this fiscal year to between $1.10 and $1.40 a share, in line with analysts’ expecations for $1.29.

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