Seems like the stars keep aligning
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The head of TD Ameritrade Holding Corp (AMTD), long seen as a possible buyer among online brokerages, said on Tuesday there is more consolidation to come in the industry, adding the company expects to buy back shares or offer a dividend in the future.
“We’re in the seventh inning or the eighth inning of the (nine inning) industry consolidation game … We want to make sure we’re poised to take advantage of that,” said Chief Executive Fred Tomczyk.
“At some point, with the cash we’re generating, we’re going to have to return capital to our shareholders if we can,” he told a conference hosted by Barclays Capital. “At some point, share buybacks and/or a dividend will make sense.”
Tomczyk said he wants to keep $500 million to $1 billion in liquid assets on hand. The Omaha, Nebraska-based company had $1.1 billion in liquid assets, and $1.4 billion in long-term debt, at the end of June.
TD Ameritrade closed its $606 million purchase of options-focused online brokerage thinkorswim Group Inc in June. Tomczyk said on Tuesday the company is focused on domestic acquisition opportunities, and “does not want to buy someone else’s asset problems.”
Smaller rival E*Trade Financial Corp (ETFC), which has reported a string of losses due to its troubled mortgage-lending business, has been rumored by some to be a takeover target.
TD Ameritrade’s largest shareholder is Toronto Dominion Bank (TD.TO).