TD Ameritrade Earnings Preview: Spread-Based Revenues To Drive Results

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TD Ameritrade (NASDAQ: AMTD) is scheduled to announce earnings on Tuesday, July 19. As the company derives a significant portion (~50%) of its revenue from interest earning assets, a 12% year on year (y-o-y) increase in the metric is likely to boost Ameritrade’s net interest income for the quarter. Although daily average revenue trades (DARTs) at the brokerage saw only a lukewarm growth of 3% y-o-y in the months of April and May, we expect DART levels to be be significantly higher in June, owing to the volatility caused by the UK’s exit from the European Union. Consequently, Ameritrade may be able to boost its transaction-based revenues.

ameritrade_pre

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Notes:

1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com

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2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for Ameritrade.

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