Weekly Brokerage Notes: Client Assets Rise For E*Trade, Ameritrade And Charles Schwab

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E*TRADE Financial

TD Ameritrade (NYSE:AMTD), E*Trade Financial (NASDAQ:ETFC) and Charles Schwab (NYSE:SCHW) released their monthly volume figures for the month of November this week. After a surge in trading activity in October, the brokerages reported a slight sequential decline in trading volumes. However, trading volumes were still higher than the comparable prior year period. November was also a positive month for all three in terms of growth in their client assets. The stocks of Schwab and E*Trade rose by 4-6% during in the week, while the market price of Ameritrade’s stock fluctuated between $34 and $36 over the week. Here’s a quick roundup on the individual metrics and November performance for the brokerage firms.

TD Ameritrade

Ameritrade’s trading volume in October was almost 18% higher than the 2013 period, with an average of 494,000 trades per day. [1] Although Ameritrade’s trades per day in November fell from October levels, the 428,000 trades per day in November were 3% higher than the prior year period. Ameritrade’s Insured Deposit Account (IDA) balances were 3% higher than the year ago period at $74.3 billion, while its interest-earning assets grew both sequentially (2%) and annually (13%) to $19.9 billion in November. Ameritrade’s total client assets were up to $675 billion from $584 billion at the end of November last year.

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See our full analysis for TD Ameritrade

E*Trade Financial

E*Trade witnessed a similar improvement in client assets, with its net client assets rising by about 2% both annually and sequentially to $46.6 billion. [2] E*Trade’s total client assets (customer assets in brokerage accounts and banking accounts combined) were up to $294 billion from $254 billion in the year ago period. Daily average revenue trades (DARTs) for the month of November fell from October to about 163,000 trades per day, which was flat over the year ago period.

  • Trefis has a $21 price estimate for E*Trade’s stock, translating into a $5.9 billion market cap. This is about 10% below the market price, which rose by 5-6% during the week.
  • We estimate the company’s revenues to be over $1.8 billion and earnings per share of $1.10 in 2014, compared to a consensus of $1.08 according to Reuters.

See our full analysis for E*Trade Financial

Charles Schwab

Charles Schwab averaged just over 600,000 trades in October, which fell to about 470,000 trades in November. [3] The brokerage added 70,000 new accounts in November taking the total number of active brokerage accounts to over 9.3 million. Schwab’s total client assets under management were over $2.48 trillion at the end of November, up from just over $2.21 trillion in November 2013. We currently forecast Schwab’s total client assets to breach the $2.5 trillion mark before the end of next year. [4]

  • Trefis has a $25 price estimate for Charles Schwab, translating into a $33.2 billion market cap. This is about 15% lower than the current market price, which rose by about 4% during the week.

See our full analysis for Charles Schwab

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Notes:
  1. Ameritrade Monthly Metrics For November, TD Ameritrade Investor Relations, December 2014 []
  2. E*Trade Monthly Metrics For November, E*Trade Investor Relations, December 2014 []
  3. Charles Schwab Trading Metrics For October and November, Charles Schwab Investor Relations, December 2014 []
  4. Charles Schwab Monthly Metrics For November, Charles Schwab Investor Relations, December 2014 []