TD AMERITRADE & SCHWAB Satisfy, Awaiting E*TRADE (AMTD, SCHW, ETFC)

TD AMERITRADE (NASDAQ: AMTD) came in with a solid report of $0.31 EPS on $623 million revenues.  First Call had estimates $0.31 EPS on $615.66 million in revenues.  It also reaffirmed guidance for FY2008 and sees EPS of $1.32 vs. $1.34 estimates.

The shares of Joe Moglia & Co. are trading up over 2% pre-market at $17.97, which is still in the middle of the $13.82 to $21.31 trading range of the last 52-weeks.

After today’s close, we’ll see earnings out of E*TRADE (NASDAQ: ETFC), and estimates from First Call are -$0.10 EPS on $ 363.94 million in revenues.  Next quarter estimates are -$0.03 EPS on $ 404.16 million in revenues. Estimates for fiscal Dec-2008 are -$0.12 EPS on $1.65 billion in revenues.

Last night we noted that the earnings report would be better on quality out of Ameritrade as it didn’t have the same financial asbestos that E*Trade had.  But the one with the most leveraged opportunity will probably be E*TRADE, and now we’ll have to see if the rough week we have seen in E*TRADE was justified or not.  The street acts like it is bracing for more asbestos found in the lunch room there, so we’ll see.  E*TRADE shares are up almost 1% at $3.36 in pre-market trading.

Charles Schwab Corp. (NASDAQ: SCHW) already reported earnings earlier this week that met analyst estimates, and its shares have traded up while E*TRADE hasn’t.  E*TRADE will have a lot to prove, but even an additional writedown or major charges should be tolerated so long as they are no death sentence.

Jon C. Ogg
April 16, 2008

Jon Ogg produces the Special Situation Investing Newsletter.  He can be reached at [email protected] and he does not own securities in the companies he covers.