TD Ameritrade Profit Rose 69%, to 24 Cents a Share

TD Ameritrade said fourth-quarter profits rose 69% from a year ago, sending shares of the online brokerage higher.

The company, formed last year when Ameritrade bought TD Waterhouse USA from Toronto-Dominion Bank, said first-quarter net income rose to $146 million, or 24 cents a diluted share, from $86 million, or 21 cents a share, in the year-ago period.

Per-share results are based on 603 million average shares outstanding, up sharply from 406.6 million a year ago.

"We feel good about where we are heading for the rest of the year and into next year," Joe Moglia, TD Ameritrade's chief executive officer, told CNBC.

Revenue surged 92% to $535 million. Commissions and transaction fees rose 48%, and money market and mutual fund fees increased six-fold.

Analysts polled by Thomson Financial were expecting net earnings per share of 22
cents on revenue of $517.44 million during the quarter.

TD Ameritrade said in October that it expected to post per share earnings of between 24 cents and 30 cents. At the time, analysts were expecting earnings of 27 cents, according to Thomson. In July, the company said fourth-quarter numbers would come in between 27 cents and 32 cents.

The company reaffirmed the midpoint of its fiscal 2007 profit outlook at $1.10 per share. Analysts currently expect earnings of $1.12 a share, on average.

Moglia was asked on the company's conference call earlier Tuesday whether the online brokerage would make a good partner for a larger, full-service brokerage firm. While Moglia said the company would be an attractive candidate for a firm looking to reach the mass afffluent market, he told CNBC that investors shouldn't ascribe too much weight to his statement.

"I've always said that," Moglia told CNBC, adding that he believe investors overreacted to his statement on the conference call. "Nobody should misconstrue that as we are up for sale or are in the middle of negotiation."

Moglia believes there will be more consolidation among online brokerage firms, though he said most deals have already taken place. "At the end of the day, if there is something that makes sense for our shareholders or our clients long-term, that is something we would certainly look at. That has been our modus operandi the whole time."

Moglia also told CNBC that the company now expects the integration between Ameritrade and TD Waterhouse to be completed in May - instead of March - to avoid overstressing the company's call centers during tax season.

A replay of the company's conference call is available on its website.