Back to top

Analyst Blog

On Jun 4, 2013, we reiterated our long-term recommendation on TD Ameritrade Holding Corporation (AMTD - Analyst Report) at Neutral. This was based on the company’s strong fiscal second-quarter results. However, a fall in the company’s daily average client trades remains a plausible concern.

Why Neutral?

TD Ameritrade’s earnings for the said quarter came in at 26 cents per share, marginally beating the year-ago figure as well the Zacks Consensus Estimate. The results were primarily driven by a rise in revenues and fall in operating expenses. Moreover, the company’s strong capital deployment activities will boost investors’ confidence in the stock.

The Zacks Consensus Estimate for 2013 remained stable at $1.11 per share over the last 60 days. However, for 2014, the Zacks Consensus Estimate went down by 0.8% to $1.22 per share over the same time period. Hence, the company currently carries a Zacks Rank #3 (Hold).

TD Ameritrade’s advanced technology platform and the personal support of its service teams help RIAs to grow and manage their practices more efficiently. We believe that the company is advantageously poised to continue benefiting from both industry growth in RIAs and the increasing demand for retail investors.

Moreover, TD Ameritrade’s association with The Toronto-Dominion Bank (TD - Snapshot Report) allows it operate from the latter’s offices and this can help drive revenue growth in the near term.

However, since TD Ameritrade is mainly an online broker, laws and regulations as well as safeguarding practices related to the Internet can adversely affect its business.  Further, other regulations like the Dodd-Frank Act and constraints imposed on margin lending activities by the Federal Reserve System and Financial Industry Regulatory Authority remain headwinds to the company.

Other Brokerage Firms to Consider

Better performing brokerage firms include Ladenburg Thalmann Financial Services Inc. (LTS - Snapshot Report) and LPL Financial Holdings Inc. (LPLA - Snapshot Report), both of which carry a Zacks Rank #1 (Strong Buy).

Please login to or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research


Are you a new Zacks Member or a visitor to

Top Zacks Features

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
SIGNET JEWE… SIG 116.37 +7.72%
CHYRONHEGO… CHYR 2.72 +5.84%
US SILICA H… SLCA 70.72 +4.00%
MALLINCKROD… MNK 80.11 +2.32%
RF MICRO DE… RFMD 11.76 +2.31%