Chuck Says Broker Earnings are Declining

Discount broker, Charles Schwab Corporation (NYSE:SCHW) has announced that its earnings per share in the fourth quarter are likely to be $0.04 to $0.06 lower than the previous quarter.

The main reasons for the lower guidance are an 8% decline in client activity in the current month compared to November, and, more significantly, the erosion in the interest margin on mortgage-backed securities held in the company’s investment portfolio. The latter was sparked primarily by declines in interest rates caused by the Fed.

CFO Joe Martinetto said, “We believe the incremental pressure on our net interest margin is transitory and expect it to ease as prepayment activity slows. With our strong business momentum, ongoing investment in our clients and sustained expense discipline, we remain well positioned to deliver improving revenues and earnings as the environment stabilizes or improves.”

Here’s how brokerage stocks are trading now:

Charles Schwab Corp. (NYSE:SCHW): SCHW shares recently traded at $11.12, down $0.41, or 3.56%. They have traded in a 52-week range of $10.56 to $19.69. Volume today was 18,204,821 shares versus a 3-month average volume of 14,163,400 shares. The company’s trailing P/E is 16.57, while trailing earnings are $0.67 per share. Get the most recent company news and stock data here >>

E*TRADE Financial Corporation (NASDAQ:ETFC): ETFC shares recently traded at $8.09, down $0.49, or 5.71%. They have traded in a 52-week range of $7.74 to $18.13. Volume today was 7,753,353 shares versus a 3-month average volume of 7,223,080 shares. The company’s trailing P/E is 15.86, while trailing earnings are $0.51 per share. Get the most recent company news and stock data here >>

TD AMERITRADE Holding Corporation (NASDAQ:AMTD): AMTD shares recently traded at $15.26, down $0.35, or 2.24%. They have traded in a 52-week range of $13.43 to $22.90. Volume today was 3,026,863 shares versus a 3-month average volume of 4,472,960 shares. The company’s trailing P/E is 13.75, while trailing earnings are $1.11 per share. Get the most recent company news and stock data here >>

Raymond James Financial Inc. (NYSE:RJF): RJF shares recently traded at $29.13, down $0.26, or 0.88%. They have traded in a 52-week range of $23.16 to $39.68. Volume today was 519,603 shares versus a 3-month average volume of 919,856 shares. The company’s trailing P/E is 13.27, while trailing earnings are $2.19 per share. Get the most recent company news and stock data here >>

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