Shares of brokerage TD Ameritrade Holding Corp. (NASDAQ: AMTD) shed nearly 10 percent in Tuesday trading after the firm lowered its guidance for fiscal 2007 and first-quarter income fell 18 percent.
The Omaha, Neb.-based broker posted net income of $141 million on revenue of $525 million for its fiscal first quarter. It earned 23 cents per share. Analysts surveyed by Thomson First Call forecast earnings of 24 cents a share and revenue of $533.9 million, on average.
The firm forecast fiscal 2007 earnings in the range of 92 cents $1.08 per share. Analysts polled by Thomson Financial had forecast earnings of $1.09.
The drop in revenue was cushioned by a rise in client assets and new customers, the firm said. For the quarter ending on March 31, Ameritrade added 166,000 new accounts to total 6.23 million. Despite this, the firm still lowered its outlook
While asset-based revenues remain more than 60%, we've adjusted our guidance to account for the impact of recent market volatility and lower activity rates, CEO Joe Moglia said in a press release. We have also decided to increase investments in our client experience to position us for more growth in 2008.
Ameritrade said it now expects 2007 earnings of 92 cents a share to $1.08 a share, compared to the Wall Street target of $1.09 a share. Earlier, Ameritrade said it expected earnings of $1.10 a share for the year.
Ameritrade shares fell $1.56, or 9.25 percent, to $15.31 in afternoon trading on the Nasdaq Stock Market.