Upcoming AWS Coverage on TD Ameritrade Holding Post-Earnings Results
LONDON, UK / ACCESSWIRE / April 21, 2017 / Active Wall St. announces its post-earnings coverage on The Charles Schwab Corp. (NYSE: SCHW). The Company released its first quarter fiscal 2017 results on April 18, 2017. The financial services firm surpassed top- and bottom-line expectations. Register with us now for your free membership at: http://www.activewallst.com/register/.
One of The Charles Schwab’s competitors within the Investment Brokerage – National space, TD Ameritrade Holding Corp. (NASDAQ: AMTD), held its quarterly conference call to discuss fiscal second quarter financial results and related matters, on Wednesday, April 19, 2017. AWS will be initiating a research report on TD Ameritrade in the coming days.
For the three months ended March 31, 2017, Charles Schwab generated net revenue of $2.08 billion, up 18% compared to revenue of $1.76 billion in Q1 2016. The Company’s revenue numbers surpassed analysts’ consensus of $2.06 billion.
For Q1 2017, Charles Schwab’s net interest revenue grew 30% to $1 billion as a result of larger client cash sweep balances and the subsequent increase in interest-earning assets, as well as higher interest rates across the yield curve. The Company’s Asset management and administration fees increased 18% to $823 million in the reported quarter largely due to continued improvement in net money fund revenue from rising rates and growing balances in advisory solutions, mutual funds, and ETFs. Trading revenue declined 17% to $192 million, primarily reflecting the impact of lower trade pricing.
For Q1 2017, Charles Schwab posted record net income of $564 million, up 8% from $522 million in Q4 2016 and up 37% compared to net income of $412 million in Q1 2016. On a per share basis, the Company reported earnings of $0.39 per share up 34% compared to earnings of $0.29 per share in the year ago same period. Earnings also beat Wall Street’s expectations of $0.37 per share.
During Q1 2017, Charles Schwab’s clients opened more than 100,000 new brokerage accounts per month, putting total new accounts at 362,000, the highest quarterly total in 17 years excluding acquisitions. The Company’s Retail business gathered record levels of core net new assets over the past three months, posting an 83% increase over the year-earlier period. Advisor Services attracted near-record inflows from the independent advisor clients who has custody with Charles Schwab and achieved a 57% increase.
Charles Schwab’s net new assets across the company reached $39 billion for Q1 2017, up 22%, and total client assets rose to $2.92 trillion at month-end March, up 14% on y-o-y basis. During the reported quarter, the Company’s financial consultants held planning conversations with 38,000 clients, up 12% on a y-o-y basis. At the end of March, Charles Schwab had $1.48 trillion in assets enrolled in some form of ongoing advisory service, an increase of $200 billion from the year ago period. The Company ended March quarter serving 10.3 million active brokerage accounts, 1.1 million banking accounts, and 1.5 million retirement plan participants, up 5%, 7%, and 1%, respectively.
During Q1 2017, Charles Schwab issued $650 million in 3.2% senior notes due in 2027. The Company also transferred approximately $1.1 billion of Schwab One® balances to Schwab Bank, which has greater flexibility than the broker-dealer in investing client cash sweep balances. Charles Schwab’s current plans call for transferring approximately $500 million to $1 billion in sweep money fund balances to the Bank during Q2 FY17. Schwab’s consolidated balance sheet totaled $227 billion at quarter-end, up 19%, and the Company’s preliminary Tier 1 Leverage ratio was 7.1%. Charles Schwab’s Q1 2017 return on equity reached 15%, the highest in six years.
On April 20, 2017, Charles Schwab’s Board of Directors declared a regular quarterly cash dividend of $0.08 per common share. The dividend is payable May 26, 2017, to stockholders of record as of close of business on May 12, 2017.
In addition, Charles Schwab’s Board of Directors declared a regular quarterly dividend on the outstanding Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series B, in the amount of $15.00 per share or $0.375 per depositary share, each representing 1/40th interest in a share of Series B Preferred Stock. The dividend is payable June 01, 2017, to stockholders of record at the close of business on May 17, 2017. The Board also declared a regular quarterly dividend on the outstanding Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series C, in the amount of $15.00 per share or $0.375 per depositary share, each representing 1/40th interest in a share of Series C Preferred Stock. The dividend is payable June 01, 2017, to stockholders of record at the close of business on May 17, 2017.
Charles Schwab’s Board of Directors also declared a regular quarterly dividend on the outstanding Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series D, in the amount of $14.88 per share., or $0.372 per depositary share, each representing 1/40th interest in a share of Series D Preferred Stock. The dividend is payable June 01, 2017, to stockholders of record at the close of business on May 17, 2017.
On Thursday, April 20, 2017, Charles Schwab’s share price finished yesterday’s trading session at $38.68, climbing 1.04%. A total volume of 8.47 million shares exchanged hands, which was higher than the 3 months average volume of 8.04 million shares. The stock has soared 20.59% and 34.17% in the last six months and past twelve months, respectively. The stock is trading at a PE ratio of 29.57 and has a dividend yield of 0.83%.
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