Compass Point Starts TD Ameritrade (AMTD) at Neutral

Compass Point initiates coverage on TD Ameritrade (NYSE: AMTD) with a Neutral. PT $17.00.

The firm comments, "D Ameritrade's strong organic growth and capital activity set it apart from its online broker peers, but the company’s earnings remain primarily levered to interest rates, and absent any meaningful, sustainable improvement, EPS growth and AMTD shares will likely remain relatively muted, in our view. That said, despite a challenging retail environment, we fully expect top-tier asset gathering to continue, and revenues could benefit from increased volatility around January’s fiscal cliff deadline. Furthermore, management has historically been active in returning capital to shareholders, and although buyback activity may be slowing, we expect continued cash flow generation to provide flexibility to pay a special dividend or become more aggressive through M&A later on."

For an analyst ratings summary and ratings history on TD Ameritrade click here. For more ratings news on TD Ameritrade click here.

Shares of TD Ameritrade closed at $15.26 yesterday.

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