TD Ameritrade (AMTD): RiverPark Foresees Double-Digit Revenue and 20% Earnings Growth

In Q2’18 investor letter, RiverPark Large Growth Fund discussed TD Ameritrade Holding Corp. (NASDAQ: AMTD) and other companies. We’ve already covered Adidas AG, Northrop Grumman, Dollar Tree, EOG Resources, CarMax, Align Technology, and Amazon. In this article, we’re going to take a look at the fund’s comments about TD Ameritrade whose shares declined during the second quarter of 2018. Here is what RiverPark said about AMTD in the letter.

AMTD shares declined along with the financial sector due to a volatile market and to reporting slightly negative daily average revenue trade metrics. To us, more importantly, the Fed rate hike bodes well for future earnings as does AMTD’s solid asset growth. For May, TD Ameritrade net new assets were $22.2 billion, implying a solid 7% annualized client asset organic growth rate.

Regardless of the timing of continued Fed rate hikes, we continue to project double-digit revenue growth and 20% earnings growth per year for Ameritrade over the coming years driven by strong asset gathering and disciplined expense control. These rates of growth could be substantially higher should the pace of Fed rate hikes accelerate.

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TD Ameritrade Holding Corp. (NASDAQ: AMTD) is a $31.24-market cap provider of investing services and education to more than 11 million client accounts totaling more than $1.2 trillion in assets, and custodial services to more than 6,000 registered investment advisors.

Shares of TD Ameritrade Holding Corp. (NASDAQ: AMTD) are up 6.48% so far this year. The stock has fallen 2.34% over the past three months. Whereas, the share price has jumped 16.93% over the past 12 months. The stock, closing at $55.04 on Tuesday, has a consensus average target price of $67.57 and a consensus average recommendation of ‘OVERWEIGHT’, according to analysts polled by FactSet Research.

Meanwhile, TD Ameritrade isn’t a very popular stock among hedge funds covered by Insider Monkey. As of the end of the second quarter of 2018, there were 28 funds in our database with positions in the company.

Disclosure: none