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E*TRADE Financial (ETFC) April DARTs Down 3% from March
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E*TRADE Financial Corporation reported a fall in its Daily Average Revenue Trades (DARTs) for Apr 2017. According to its monthly market activity, the company’s DARTs were 196,022, down 3% from the prior month, but up 23% year over year. Notably, derivatives comprised 31% of DARTs during April.
Broker performance is generally measured through DARTs that represent the number of trades from which brokers can expect commission or fees. The fall in DARTs largely reflects investors’ reluctance in investing in equity markets.
At the end of the month under review, E*TRADE’s total number of accounts were approximately 5.3 million, comprising about 3.5 million brokerage accounts, 1.5 million stock plan accounts and 0.3 million banking accounts.
For the reported month, E*TRADE’s total brokerage accounts included 38,904 gross new brokerage accounts. Total brokerage accounts highlight the company’s ability to gain and retain customers who trade and invest.
Moreover, E*TRADE’s net new brokerage assets came in at negative $0.2 billion compared with $1.6 billion recorded in the prior month.
At the end of Apr 2017, E*TRADE’s customer security holdings were $248.3 billion, up from $243.8 billion in Mar 2017. The company’s brokerage-related cash declined 1% to $52.7 billion from $53.5 billion in the prior month, with customers being the net buyers of about $0.5 billion in securities. In addition, bank-related cash and deposits for the company totaled $5.3 billion, down from $5.4 billion in the previous month.
Peer Performance
Among other investment brokers, Interactive Brokers Group, Inc.’s (IBKR - Free Report) Electronic Brokerage segment reported a year-over-year decline in DARTs for Apr 2017. Total client DARTs were 645,000, down 3% from Apr 2016. Also, DARTs were marginally down from the previous month. However, total customer accounts were up 18% year over year, and 1% sequentially to 411,000.
TD Ameritrade Holding Corporation (AMTD - Free Report) reported average client trades per day of 502,000 in its activity report for Apr 2017. The reported figure was flat with the prior-month tally and increased 7% from the year-ago period.
The Charles Schwab Corporation (SCHW - Free Report) released monthly activity report for Apr 2017, which shows an improvement over the year-ago period. Total client assets were $2.95 trillion at the end of the month, up 14% year over year. Further, client assets receiving ongoing advisory services were $1.50 trillion, up 16% year over year. Also, Schwab’s average interest earning assets were $217.4 billion at April end, indicating 19% increase on a year-over-year basis.
Our Viewpoint
Growth in DARTs and new brokerage accounts will prove to be beneficial for the company. We, however, are concerned about the sluggish macroeconomic environment, which might lead to lesser trading activities.
The company’s shares gained 3.3% over the last six months, underperforming 3.8% growth recorded by the Zacks categorized Investment Bank industry.
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E*TRADE Financial (ETFC) April DARTs Down 3% from March
E*TRADE Financial Corporation reported a fall in its Daily Average Revenue Trades (DARTs) for Apr 2017. According to its monthly market activity, the company’s DARTs were 196,022, down 3% from the prior month, but up 23% year over year. Notably, derivatives comprised 31% of DARTs during April.
Broker performance is generally measured through DARTs that represent the number of trades from which brokers can expect commission or fees. The fall in DARTs largely reflects investors’ reluctance in investing in equity markets.
At the end of the month under review, E*TRADE’s total number of accounts were approximately 5.3 million, comprising about 3.5 million brokerage accounts, 1.5 million stock plan accounts and 0.3 million banking accounts.
For the reported month, E*TRADE’s total brokerage accounts included 38,904 gross new brokerage accounts. Total brokerage accounts highlight the company’s ability to gain and retain customers who trade and invest.
Moreover, E*TRADE’s net new brokerage assets came in at negative $0.2 billion compared with $1.6 billion recorded in the prior month.
At the end of Apr 2017, E*TRADE’s customer security holdings were $248.3 billion, up from $243.8 billion in Mar 2017. The company’s brokerage-related cash declined 1% to $52.7 billion from $53.5 billion in the prior month, with customers being the net buyers of about $0.5 billion in securities. In addition, bank-related cash and deposits for the company totaled $5.3 billion, down from $5.4 billion in the previous month.
Peer Performance
Among other investment brokers, Interactive Brokers Group, Inc.’s (IBKR - Free Report) Electronic Brokerage segment reported a year-over-year decline in DARTs for Apr 2017. Total client DARTs were 645,000, down 3% from Apr 2016. Also, DARTs were marginally down from the previous month. However, total customer accounts were up 18% year over year, and 1% sequentially to 411,000.
TD Ameritrade Holding Corporation (AMTD - Free Report) reported average client trades per day of 502,000 in its activity report for Apr 2017. The reported figure was flat with the prior-month tally and increased 7% from the year-ago period.
The Charles Schwab Corporation (SCHW - Free Report) released monthly activity report for Apr 2017, which shows an improvement over the year-ago period. Total client assets were $2.95 trillion at the end of the month, up 14% year over year. Further, client assets receiving ongoing advisory services were $1.50 trillion, up 16% year over year. Also, Schwab’s average interest earning assets were $217.4 billion at April end, indicating 19% increase on a year-over-year basis.
Our Viewpoint
Growth in DARTs and new brokerage accounts will prove to be beneficial for the company. We, however, are concerned about the sluggish macroeconomic environment, which might lead to lesser trading activities.
E*TRADE currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The company’s shares gained 3.3% over the last six months, underperforming 3.8% growth recorded by the Zacks categorized Investment Bank industry.
5 Trades Could Profit "Big-League" from Trump Policies
If the stocks above spark your interest, wait until you look into companies primed to make substantial gains from Washington's changing course.
Today Zacks reveals 5 tickers that could benefit from new trends like streamlined drug approvals, tariffs, lower taxes, higher interest rates, and spending surges in defense and infrastructure. See these buy recommendations now >>