Fiscal Q3 Earnings: TD Ameritrade's Decline Versus Prior Quarter

CEO Tomczyk points to $97 million share buyback and 8% new client asset growth

TD Ameritrade (AMTD) announced fiscal third-quarter 2011 earnings on Tuesday, reporting earnings per share of $0.27 on profits of $157.4 million compared with EPS of $0.30 on profits of $171.7 million in the second quarter.

Revenues stood at $684.8 million versus $718.2 million in the third quarter, ended June 30, according to an AMTD news release. Average client trades per day were approximately 370,000, a decrease of 11%.

Analysts had expected TD Ameritrade to pull in earnings of $0.29. A year ago, Q3 2010 EPS totaled $0.31 while profits came to $179.4 million and revenues totaled $691.8 million.

Fred Tomczyk, TD Ameritrade president and chief executive officer, pointed to net new client assets of $7.9 billion, at an annualized growth rate of 8%.

“Despite the economic uncertainty and what looks to be a seasonally slow summer, we delivered solid growth in net new assets and asset-based revenues. Year to date, we have gathered $29.1 billion in net new assets, an annualized growth rate of 11%," Tomczyk said in a statement.

TD Ameritrade’s financial position allowed the company to buy back close to 5 million shares, or 1% of outstanding common stock, for approximately $97 million, in the quarter.

“When that is combined with our quarterly dividend, we returned 80% of our quarterly net income to shareholders,” Tomczyk said. “We remain focused on initiatives that will drive client engagement and fuel organic growth."

For more Q2 news, go to AdvisorOne’s Earnings Calendar for the Finance Sector.

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