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Here's Why You Should Invest in TD Ameritrade (AMTD) Now
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From the vast universe of banking stocks, today we pick TD Ameritrade Holding Corporation (AMTD - Free Report) for you. With record earnings, revenues and net new client assets in fiscal 2019, the company is a solid buying opportunity. The company’s strong trading volumes, client focus and cross-selling opportunities are anticipated to yield positive results for the stock.
The stock has been witnessing upward estimate revisions, reflecting analysts’ optimism about its earnings growth potential. Over the past 60 days, the Zacks Consensus Estimate for 2019 and 2020 displayed an upward trend.
Further, this Zacks Rank #2 (Buy) stock has gained 3.7%, year to date, compared with its industry’s growth of 18.5%.
Why is TD Ameritrade a Must Buy
Strong Organic Growth: TD Ameritrade continues to be a leading asset gatherer, with 11 consecutive years of double-digit net new client asset growth since fiscal 2008. Notably, during fiscal 2019, the company witnessed an annualized growth rate of 7% in net new client assets, within its long-term target of 7-10%. Notably, total net new assets exceeded $90 billion this year from the $60 billion recorded in 2016.
Additionally, the company’s net revenues witnessed a 16.7% compounded annual growth rate (CAGR) over the last five years, ending fiscal 2019.
Strong Trading Activity: TD Ameritrade’s trading volumes have been displaying an uptrend. The company’s average client trades per day have been increasing for the past few years, with the trend continuing in fiscal 2019, mainly benefiting from the volatility in markets. In the near term, the company will be able to improve trading volumes backed by anticipated improvement in equity markets as well as its innovative trading platforms. Additionally, the company continues to undertake investment spending in technology and advertising that are likely to enhance the overall business.
Strong Leverage: TD Ameritrade’s debt/equity ratio is 0.41 compared with the S&P 500 average of 0.71, indicating a relatively lower debt burden. It highlights the company’s financial stability in an unstable economic environment.
Superior Return on Equity (ROE): TD Ameritrade’s ROE of 27.18% as compared with the industry’s average of 11.84% reflects the company’s commendable position compared with its peers.
Piper Jaffray Companies has been witnessing upward estimate revisions for the past 60 days. Further, the company’s shares have gained 21.5%, year to date. At present, it carries a Zacks Rank of 2.
BlackRock, Inc. (BLK - Free Report) has been witnessing upward estimate revisions for the past 60 days. Additionally, the stock has jumped around 27.2%, year to date. It currently carries a Zacks Rank #2.
The Hottest Tech Mega-Trend of All
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
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Here's Why You Should Invest in TD Ameritrade (AMTD) Now
From the vast universe of banking stocks, today we pick TD Ameritrade Holding Corporation (AMTD - Free Report) for you. With record earnings, revenues and net new client assets in fiscal 2019, the company is a solid buying opportunity. The company’s strong trading volumes, client focus and cross-selling opportunities are anticipated to yield positive results for the stock.
The stock has been witnessing upward estimate revisions, reflecting analysts’ optimism about its earnings growth potential. Over the past 60 days, the Zacks Consensus Estimate for 2019 and 2020 displayed an upward trend.
Further, this Zacks Rank #2 (Buy) stock has gained 3.7%, year to date, compared with its industry’s growth of 18.5%.
Why is TD Ameritrade a Must Buy
Strong Organic Growth: TD Ameritrade continues to be a leading asset gatherer, with 11 consecutive years of double-digit net new client asset growth since fiscal 2008. Notably, during fiscal 2019, the company witnessed an annualized growth rate of 7% in net new client assets, within its long-term target of 7-10%. Notably, total net new assets exceeded $90 billion this year from the $60 billion recorded in 2016.
Additionally, the company’s net revenues witnessed a 16.7% compounded annual growth rate (CAGR) over the last five years, ending fiscal 2019.
Strong Trading Activity: TD Ameritrade’s trading volumes have been displaying an uptrend. The company’s average client trades per day have been increasing for the past few years, with the trend continuing in fiscal 2019, mainly benefiting from the volatility in markets. In the near term, the company will be able to improve trading volumes backed by anticipated improvement in equity markets as well as its innovative trading platforms. Additionally, the company continues to undertake investment spending in technology and advertising that are likely to enhance the overall business.
Strong Leverage: TD Ameritrade’s debt/equity ratio is 0.41 compared with the S&P 500 average of 0.71, indicating a relatively lower debt burden. It highlights the company’s financial stability in an unstable economic environment.
Superior Return on Equity (ROE): TD Ameritrade’s ROE of 27.18% as compared with the industry’s average of 11.84% reflects the company’s commendable position compared with its peers.
Other Stocks to Consider
Morgan Stanley (MS - Free Report) has been witnessing upward estimate revisions for the past 60 days. Moreover, this Zacks #2 Ranked stock has rallied more than 27%, year to date. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Piper Jaffray Companies has been witnessing upward estimate revisions for the past 60 days. Further, the company’s shares have gained 21.5%, year to date. At present, it carries a Zacks Rank of 2.
BlackRock, Inc. (BLK - Free Report) has been witnessing upward estimate revisions for the past 60 days. Additionally, the stock has jumped around 27.2%, year to date. It currently carries a Zacks Rank #2.
The Hottest Tech Mega-Trend of All
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>