The May plunge was pretty scary, but several stock market indices continue to post solid results this year. The Nasdaq 100 is up 13.8% YTD, the S&P 500 is up by 8.4%. Yet, if the Q2 performance by Schwab and TD Ameritrade are any indication, retail investors remain cautious.
Brad Hints of Bernstein Research writes this morning:
Schwab reported operating EPS of $0.17 for Q2'12, a penny below our estimate andBrad Hintz' notes on Schwab's performance:
Schwab: Solid Q2'12 Results Despite Retail Investor Headwinds
- Schwab reported operating EPS of $0.17 for Q2'12, a penny below our estimate and consensus.
- Pre-tax margin excluding a one-time gain was 28.2%, up from 26.3% last quarter but below the 32.4% figure achieved in Q2'11 and the firm's 2012 guidance of 30%. Month-to-date volumes are tracking lower.
- We adjust our 2012 EPS estimate up to $0.67 from $0.65 reflecting progress cutting expenses, but we remain below consensus ($0.69). We also increase our 2013 estimate by $0.02 to $0.81. We rate SCHW market-perform with a $15 price target.