=====Charles Schwab (SCHW) reported earnings on Tue 18 Jul 23 (b/o)

 

Charles Schwab beats by $0.04, reports revs in-line

• Reports Q2 (Jun) earnings of $0.75 per share, excluding non-recurring items, $0.04 better than the FactSet Consensus of $0.71; revenues fell 8.6% year/year to $4.66 bln vs the $4.61 bln FactSet Consensus.
• Co-Chairman and CEO Walt Bettinger noted, "Schwab's modern approach to wealth management continues to resonate with investors, helping to sustain our strong client momentum. During the second quarter, we gathered $52 billion in core net new assets -- bringing year-to-date asset gathering to over $180 billion and keeping us squarely within our long-term organic growth range of 5% -- 7%. While we observed signs of typical tax seasonality, as well as softer investor sentiment at the beginning of the quarter, we still attracted nearly 1 million new brokerage accounts and finished the period serving $8.02 trillion in total client assets across 34 million accounts."

-=TD Ameritrade (AMTD) to be acquired by Charles Schwab (SCHW) for $26 bln

 TD Ameritrade to be acquired by Charles Schwab (SCHW) for approximately $26 bln in all-stock transaction

Under the agreement, TD Ameritrade stockholders will receive 1.0837 Schwab shares for each TD Ameritrade share, which represents a 17% premium over the 30-day volume weighted average price exchange ratio as of November 20, 2019.

With today's announcement, the TD Ameritrade Board of Directors has suspended its previously disclosed CEO search, naming Stephen Boyle, TD Ameritrade EVP and CFO, as the company's interim President and CEO. Mr. Boyle will assume leadership of the company effective immediately, guiding its management team through its fiscal 2020 plan and the proposed integration with Schwab.

With anticipated synergies, the deal is expected to be 10-15% accretive to GAAP EPS and 15-20% accretive to Operating Cash EPS in year three, post-close. Focusing on expenses, current estimates are for approximately $1.8 to $2 billion run-rate expense synergies, which represents approximately 18-20% of the combined cost base. Some of the expense synergies the combined firm expects to realize will come from elimination of overlapping and duplicative roles. Additional synergies are expected to be achieved through real estate, administrative and other savings. Details on these synergies will be shared at a later date, once the integration process is underway.

TD Ameritrade (AMTD) to be acquired by Charles Schwab (SCHW) ?

• Charles Schwab (SCHW) is in talks to acquire TD Ameritrade (AMTD) for $26 billion, according to reports from CNBC and FOX Business. The move comes after industry disruption essentially forced brokerage firms to cut trading commissions to zero. 

AMTD daily

=Charles Schwab (SCHW) reported earnings on Tue 15 Oct 2019 (b/o)

Charles Schwab beats by $0.06, beats on revs 

Reports Q3 (Sep) earnings of $0.70 per share, $0.06 better than the S&P Capital IQ Consensus of $0.64; revenues rose 5.1% year/year to $2.71 bln vs the $2.65 bln S&P Capital IQ Consensus.

"Our contemporary full-service model helps us remain a trusted partner as clients navigate an environment that has only grown more cloudy in recent months. The equity markets have shown noteworthy durability -- the S&P 500 remained up nearly 20% for the year as of quarter-end. Concerns persist, however, regarding global trade and a generally softening economic outlook. The Federal Reserve has moved forward with expected mid-cycle easing, cutting short-term interest rates 25 bps in both July and September, and long-term rates have also shown significant declines. Against this backdrop, clients brought us $56.6 billion in core net new assets, a third quarter record, which brings our year-to-date total to $145.5 billion, representing a 6% annualized organic growth rate. In addition, we attracted 363,000 new brokerage accounts in the quarter, helping raise active brokerage accounts to 12.1 million, up 6% year-over-year. Client demand for help and guidance continued to grow, with assets receiving ongoing advisory services reaching nearly $2.0 trillion at quarter end, up 7%. Assets in digital advisory solutions grew even faster, rising 20% to $43.0 billion at the end of September. Overall, our client assets totaled a record $3.77 trillion at quarter end, up 6%."

Earnings this week : Oct 14 - 18, 19 (wk 42)

Monday (October 14)

• None

COLUMBUS DAY: In honor of the holiday, US bond markets and the Federal Reserve Bank will be closed on Monday, October 14, 2019. Stock, options, and futures markets will be open.

Tuesday (Oct 15)

• Morning: APHA BLK C FRC GS JNJ JPM OMC PLD SCHW UNH WFC WIT
• Afternoon: HWC JBHT PNFP SNBR UAL

Wednesday (Oct 16)

• Morning: ABT  ALLY ASML BAC BK CBSH CMA FHN PGR PNC USB
• Afternoon: AA CATY CCI CCK CNS CSX EGBN IBM KMI LLNW NFLX SLG STLD TBK TCBI UMPQ URI WTFC

Thursday (Oct 17)

• Morning: BBT BMI DOV ERIC EWBC FNB GPC GTLS HOMB HON HTLD IIIN KEY MS MTB PM POOL PPG SASR SNA SON STI TSM TXT UNP WNS
• Afternoon: BDN ETFC EXPO FFBC ISRG MRTN OZK PBCT TEAM WAL WDFC

Friday (Oct 18) 

• Morning: ABCB AXP CFG GNTX IBKC KO KSU MAN SLB STT SXT SYF

Notable earnings reports:

• JPMorgan (JPM), Johnson & Johnson (NYSE:JNJ), UnitedHealth Group (NYSE:UNH), Goldman Sachs (NYSE:GS), Wells Fargo (WFC), Citigroup (C), United Continental (NASDAQ:UAL), Charles Schwab (NYSE:SCHW) and BlackRock (NYSE:BLK) on October 15; 
• Netflix (NASDAQ:NFLX), IBM (NYSE:IBM), Bank of America (NYSE:BAC), Kinder Morgan (NYSE:KMI) and Abbott Laboratories (NYSE:ABT) on October 16; 
• Philip Morris International (NYSE:PM), Morgan Stanley (NYSE:MS) and Union Pacific (NYSE:UNP) on October 17; Coca-Cola (NYSE:KO), American Express (NYSE:AXP), State Street (NYSE:STT) and Gentex (NASDAQ:GNTX) on October 18.

This week's biggest % winners & losers : Sept 30 - Oct 4, 19 (wk 40)

The following are this week's top percentage gainers and losers, categorized by sectors (over $300 mln market cap and 100K average daily volume).

This week's top % gainers

• Healthcare: ENDP (3.82 +19.75%), ARQL (8.29 +18.43%), SRPT (88.25 +17.67%), CDNA (25.37 +16.22%), RGNX (38.49 +15.41%), ARWR (30.6 +13.5%)
• Materials: SBGL (6.36 +14.39%)
• Consumer Discretionary: TSG (20.92 +38.82%)
• Information Technology: RNG (163.3 +31.85%), AVYA (13.23 +28.45%), OKTA (116.53 +20.06%), COUP (148.32 +15.97%)
• Energy: TOO (1.53 +30.77%), DHT (6.88 +14.1%), STNG (33.65 +14.07%), FRO (10.28 +12.72%)

This week's top % losers

• Healthcare: GTHX (23.34 -31.29%), LNTH (19.74 -22.04%), ANGO (14.6 -19.02%)
• Materials: SXC (5.31 -15.71%)
• Consumer Discretionary: GPRO (3.97 -21%), TAST (6.8 -16.46%)
• Information Technology: CASA (6.22 -20.47%)
• Financials: AMTD (33.7 -28.25%), ETFC (36.4 -15.87%). SCHW (35.67  -13.86%), IBKR (47.59  -10.86%)
• Energy: NBR (1.57 -18.65%), MDR (1.63 -18.5%), QEP (3.15 -17.54%), CDEV (3.8 -15.95%)
• Consumer Staples: UNFI (7.45 -34.76%), CALM (37.97 -16.4%)

TD Ameritrade (AMTD) and E*Trade (ETFC) eliminate trading commissions

 On October 2, shortly after the market closed, E*TRADE Financial Corp announced that its online brokerage would cut its base commission rate to $0, following in the footsteps of Charles Schwab and TD Ameritrade. 

• Now that E*TRADE, TDA, and Interactive Brokers offer some form of free trading, the industry is closely waiting for Fidelity, TradeStation and other online brokers to respond. 

E*TRADE Financial Corporation (NASDAQ: ETFC) today announced it will eliminate retail commissions for online US listed stock, ETF, and options trades. It will also reduce the options contract charge to $0.65 per contract for all traders while maintaining its active trader pricing at $0.50 per contract. These changes will take effect on October 7, 2019.

• Press release; October 2, 2019
• investopedia.com article
• charts https://finviz.com/screener.ashx?v=211&t=AMTD,ETFC,IBKR,SCHW&ta=0&o=-change

The current commission schedule shows tiered rates, depending on the client's trading frequency. The base rate was $6.95, dropping to $4.95 for clients who traded more often than 30 times per quarter. Options were charged at $6.95 per leg with $0.75 per contract; active traders paid $4.95 per leg with $0.50 per contract. 

TD Ameritrade's commission-free trading starts October 3.

=Charles Schwab (SCHW) to eliminate commissions for stocks, ETFs

Charles Schwab to eliminate commissions for stocks, ETFs and options listed on U.S. or Canadian exchanges, across all mobile and web trading channels;  

• Starting on Oct. 7, Schwab, which holds about $3.72 trillion in client assets, will be slashing its trading commission cost for U.S. stocks, ETFs and options from the previous $4.95 to zero. Trading options will continue to cost 65 cents per contract. 
• This comes after Interactive Brokers (IBKR) last week announced IBKR Lite, which will offer zero commissions on US exchange-listed stocks and ETFs, no minimums, and free market data without its IB SmartRouting system.
• Commissions have been declining for decades but the rise of commission-free trades from start-up trading app Robinhood accelerated the decline in recent years. Robinhood is expected to IPO this year or next.
• TD Ameritrade (AMTD) and E*TRADE (ETFC) seem likely to follow suit to remain competitive.  
• Schwab, TD and ETrade all saw their stock prices take an initial hit on Tuesday following Schwab's pre-market announcement. On a day that saw the S&P 500 Index decline by 1.2%, Schwab shares fell by nearly 10%, TD shares lost nearly 26% and Etrade shares declined nearly 17%.
• https://finviz.com/screener.ashx?v=211&t=AMTD,ETFC,IBKR,SCHW&ta=0&o=-change

Almost forty five years ago, Chuck Schwab made investing more accessible to all Americans with the concept of low commissions to buy and sell stocks. On October 7, 2019, in conjunction with the release of Mr. Schwab's latest book, "Invested," Charles Schwab & Co., Inc. is removing the final barrier to making investing accessible to everyone by eliminating commissions for stocks, ETFs and options listed on U.S. or Canadian exchanges, across all mobile and web trading channels1. Clients trading options will continue to pay 65 cents per contract.

Beginning October 7, 2019, the company will reduce U.S. stock, ETF and options online trade commissions from $4.95 to zero. And with no minimum account size3 to open a full featured Schwab brokerage account, every investor, no matter how large or small, can benefit from the expertise and support of a firm that has been entrusted with more than $3.7 trillion in client assets. Every Schwab client using our web and mobile channels automatically qualifies for the new pricing, without opening a new account, making a new deposit or maintaining a minimum balance of any type.

=Interactive Brokers (IBKR) will offer zero-fee trades on stocks and ETFs

Interactive Brokers (IBKR) will offer zero-fee trades on stocks and ETFs via a new service, as it looks to broaden its appeal with retail investors. IBKR stock retreated slightly Thursday, with TD Ameritrade (AMTD), E-Trade (ETFC) and Charles Schwab (SCHW) falling harder.

The new IBKR Lite service will offer unlimited trades on U.S.-listed stocks and exchange traded funds for a zero trading commission. It debuts in October. It will have no account minimums or inactivity fees.

Interactive Brokers will rebrand its existing low-fee stock trading offering as IBKR Pro.

Fee wars have engulfed financial services firms. But to date, online brokers Schwab, TD Ameritrade and E-Trade only allow customers to trade select ETFs for no commission. They've also lowered fees or removed minimums to trade stocks and ETFs, as investing apps like Robinhood capture a new generation of investors.

Customers can switch between IBKR Lite and IBKR Pro, subject to conditions. Pro clients will get potentially better pricing on stock trades through smart routing technology. Price improvement may matter less to regular investors.

Interactive Brokers' stronghold is active traders and institutions, but it's looking to tap a broader audience.

IBKR Stock, Brokerage Stocks Lagging
Interactive Brokers stock fell 0.4% to 51.51 on the stock market today, well off intraday lows of 49.36. Charles Schwab stock lost 2.2%, E-Trade stock tumbled 4.8% and AMTD stock dived 6.5%. Schwab charges $4.95 for stock trades, and has relatively high exposure to asset management. E-Trade and Ameritrade charge $6.95 per trade.

J.P. Morgan Chase (JPM) unveils its new investing app, You Invest

Shares of Charles Schwab fell 4 percent, TD Ameritrade fell 6.7 percent, E-Trade fell 4.8 percent and Interactive Brokers fell 3.1 percent in premarket trading. The move by J.P. Morgan aggravates a cold-blooded price war, with the globe's largest managers fighting for clients with low-cost options. J.P. Morgan will launch its new service next week.

• J.P. Morgan’s new digital brokerage service comes with free trades, portfolio building tool and access to equity research.
• The bank’s new trading service starts next week and will be available to its 47 million mobile or online users.
• All customers get 100 free stock or ETF trades in the first year. Those with Chase Private Client get unlimited trades.
• CEO Jamie Dimon hinted at this move in 2016, citing Amazon Prime as his inspiration.

   

The move, more than two years in the making, instantly intensifies the price war that is occurring throughout the investing landscape. Whether it’s executing trades, managing portfolios or simply owning mutual funds and ETFs, costs have been collapsing on Wall Street. Among brokerages, the free trading app provided by Robinhood Markets has gained attention recently for attracting more than 5 million users, and a $5.6 billion valuation, in just a few years. 

J.P. Morgan, the biggest U.S. bank, has a distinct advantage over many competitors: It already has financial ties with half of American households. When its engineers flip a switch in coming days, more than 47 million people who already use the company’s banking app or website will gain access to the new service, called You Invest.

“There are customers out there who may not want to trust their credentials or their money to an app of the month,” said Jed Laskowitz, a J.P Morgan veteran who runs You Invest. ”We’re thinking about what’s right for our customers, helping them get invested, and stay invested and diversified. ”

Charles Schwab (SCHW) reported earnings on Tue 17 July 18 (b/o)

** charts before earnings **

 

** charts after earnings **

 

Charles Schwab beats by $0.02, reports revs in-line 

• Reports Q2 (Jun) earnings of $0.60 per share, excluding non-recurring items, $0.02 better than the Capital IQ Consensus of $0.58; revenues rose 16.7% year/year to $2.49 bln vs the $2.46 bln Capital IQ Consensus.
• "Our first half core net new assets of $119.0 billion were also a record and represented a 7% annualized organic growth rate. Both of our primary businesses contributed to this strength in asset gathering, with Retail and Advisor Services setting new records for the first half of the year -- their net new assets were up 46% and 24%, respectively."

Earnings this week : July 16 - 20, 18 (wk 29)

Earnings expected this week

Monday (July 16)

• Morning: BAC, BLK, JBHT
• Afternoon: NFLX

Tuesday (July 17)

• Morning: UNH, JNJ, GS, PGR, OMC, SCHW, CMA, PLD, FHN, NSM, NEOG
• Afternoon: UAL, CSX, FNF, IBKR, WTFC, HWC, MLNX, PNFP, FULT, MRTN, HOPE, RNST, ADTN, LTXB

Wednesday (July 18)

• Morning: ERIC, NVS, MS, ABT, USB, TXT, GWW, ASML, NTRS, MTB, OACW, MTG, WAFD
• Afternoon: IBM, AXP, AA, KMI, CCK, EBAY, URI, CP, CCI, UFPI, PLXS, PTC, UMPQ, LHO, TCBI, SLG, BXS, RECN, CATY, NDLS, BMI, CNS, CVBF, EGBN, TBK, DWCH

Thursday (July 19)

• Morning: ABB, ADS, BBT, BX, BK, GTLS, DHR, DPZ, DOV, EWBC, FITB, GATX, GPC, HOMB, IIIN, KEY, NUE, PM, POOL, PPG, RCI, RPM, SASR, SAP, SCHL, SBNY, SNA, SON, TSM, TTS, TRV, UNP, WBC, WBS, WNS
• Afternoon: MSFT, COF, CE, CTAS, SKX, SWKS, ISRG, ETFC, SEIC, PBCT, ASB, NWE, WAL, MBFI, FFBC, BDN, FFIN, EXPO, EGP, LLNW

Friday (July 20)

• Morning: GE, HON, SLB, MAN, BHGE, SWK, STT, STI, CFG, RF, KSU, CLF, GNTX, IBKC, SXT, VFC