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Senin, 25 November 2019

Here's what advisors can anticipate amid the $26 billion Charles Schwab-TD Ameritrade tie-up - CNBC

A pedestrian passes in front of a Charles Schwab Corp. office building in New York.

Gabriella Angotti-Jones | Bloomberg | Getty Images

Charles Schwab's proposed acquisition of TD Ameritrade is stirring up worry among financial advisors.

Schwab on Monday announced it would acquire TD in a $26 billion all-stock transaction. Together, the firms will serve 24 million brokerage accounts, accounting for more than $5 trillion in client assets.

Both firms also have massive footprints in the registered investment advisory industry, where they custody investors' assets and execute trades.

They also provide firms with the technology to simplify their workflow and allow advisors to focus on financial planning.

"Together we can deliver the ultimate client experience for retail investors and independent registered investment advisors," said Stephen Boyle, TD Ameritrade's newly announced interim president and CEO, in a statement.

The merger will create a massive custodian in a field that often has little choice for these RIAs.

Clients may stay put

Clients are likely to keep their financial advisor, even amid a change in custodians, industry experts say.

That's because RIA businesses generally have so-called negative consent provisions in their paperwork when they take on new clients, meaning if the firm changes a service provider, the client has agreed to go along.

"I might change custodians if I think it's the best thing for you, and by signing this you are agreeing that you will go, unless you opt out," said Danny Sarch, founder and owner of Leitner Sarch Consultants.

Nevertheless, a client who is content with the service he or she receives will likely stay put.

"The client is generally loyal to the advisor, as long as the advisor keeps the client front of mind as he makes a decision," Sarch said.

Market concentration

Ariel Skelley | DigitalVision | Getty Images

In the RIA world, there are four custodians that make up the lion's share of the market: Fidelity, Pershing, Charles Schwab and TD Ameritrade.

Schwab, Fidelity, TD and Pershing collectively hold 80% of the RIA firms' $4 trillion in advisory assets, according to Cerulli Associates.

TD's specialty has been on the small RIA market, centering to firms with fewer than $100 million in assets under management, Sarch said.

"Pershing ignores that space, but Fidelity, Schwab and TD have traditionally competed," he said.

Advisors have raised concerns about the prospect of less competition.

"What does it mean for costs for advisors like me and for our end clients?" asked Daniel Tobias, a certified financial planner with Passport Wealth Management in Cornelius, North Carolina. His firm handles custody of client assets with TD.

"Or what if the service goes down, we have fewer options and we're that much more captive?" Tobias asked.

Small firms

Compassionate Eye Foundation | Getty Images

RIAs who are just starting out on their own or whose business model isn't centered on gathering assets have also turned to TD for their services.

In 2016, XY Planning Network, a network of fee-only advisors who charge clients a subscription fee rather than a percentage of assets under management, partnered with TD to make its services available to those advisors without requiring them to manage a minimum level of assets under management.

Indeed, 600 of the 1,100 fee-only advisors on XY Planning Network are using TD's services through this agreement and manage less than $10 million, said Alan Moore, co-founder of XY Planning Network.

"The question is, 'Will they continue to support the smaller RIA market?'" Moore asked. "I hope they see the value of working with people who are starting in the business and growing their firms and who may never have $50 million in assets."

"The custodians have to make money, but there are firms that will never meet those minimum asset requirements, and we're losing the only option we have," he said.

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2019-11-25 15:05:00Z
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Uber stopped from operating in London - The - The Washington Post

Henry Nicholls Reuters A photo illustration shows the Uber app and a bus in London, Britain, June 25, 2018.

LONDON — London’s transport authorities on Monday announced they will not renew Uber’s license to operate in the British capital after thousands of trips were made with someone other than the booked driver.

In a statement, Transport for London (TfL) said that there were “several breaches that placed passengers and their safety at risk.”

Uber’s license expires at midnight on Monday. The company, which announced it will appeal the decision, can continue to operate until a final decision is made.

This is the second time in two years that transport authorities have rejected the ride-hailing app’s bid to renew its operating license in London, one of its largest European markets.

[Uber: The ride-hailing app that says it has ‘zero’ drivers]

The app, which employs tens of thousands of drivers, is hugely popular with users in London — and unpopular with London’s iconic black cabbies.

Uber said it will appeal the decision and that, for its 3.5 million users in London and 45,000 drivers, it will be business as usual during that time. “We have fundamentally changed our business over the last 2 years, setting the standard for safety in the industry. TfL’s decision on our London licence is wrong and we will appeal,” the corporation tweeted.

Dara Khosrowshahi, Uber’s chief executive, said even though the company should be “held to a high bar,” the decision was “just wrong.”

This is the latest setback for Uber, which has clashed with transport bodies and traditional taxi-driver markets around the world. Uber has been banned, or stopped service in, countries including Denmark, Hungary and Bulgaria.

In London, transport authorities in September 2017 dropped the bombshell that they would not renew Uber’s license amid safety concerns. The company successfully appealed that decision and was granted an extension.

TfL said that Uber had made a number of improvements since then, but they didn’t go far enough. One key concern, they said, was a change to Uber’s system that “allowed unauthorised drivers to upload their photos to other Uber driver accounts.” They said that this allowed at least 14,000 trips where passengers were picked up by someone other than the booked driver.

The transport body also said that some of the drivers that were dismissed or suspended were able to open new Uber accounts, potentially “compromising passenger safety and security.”

Uber’s rivals wasted little time in applauding the move.

The Licensed Taxi Drivers Association, a trade body for London’s black cab industry, said that “The Mayor and TfL have taken the right and only decision to keep Londoners safe.”

Bolt, an Estonian ride-hailing company that has thousands of London drivers on its books, said in a statement that “we continue to pay the utmost attention to the credentials of drivers we permit to use our platform.”

London Mayor Sadiq Khan, who will face a mayoral election contest next year, said “I know this decision may be unpopular with Uber users but their safety is the paramount concern.”

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Today’s coverage from Post correspondents around the world

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2019-11-25 14:03:00Z
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Stocks making the biggest moves premarket: TD Ameritrade, Charles Schwab, Tesla & more - CNBC

Check out the companies making headlines before the bell:

TD Ameritrade – Charles Schwab will buy its rival discount broker in a $26 billion all-stock deal, with TD Ameritrade shareholders receiving 1.0837 Schwab shares for each share they now hold.

Tiffany – Tiffany agreed to be bought by France's LVMH for $16.2 billion or $135 per share in cash. The luxury goods companies expect the deal to close in mid-2020.

The Medicines Co. – The company will be bought by Swiss drugmaker Novartis for $9.7 billion or $85 per share in cash. Novartis is buying the US-based biotech company to acquire its injectable cholesterol drug inclisiran.

Tesla – Tesla CEO Elon Musk tweeted several times over the weekend about demand for its newly announced electric pickup truck, with the latest saying the company had received 200,000 orders.

Uber Technologies – The ride-hailing company was stripped of its London operating license for the second time in two years. Regulators said Uber had allowed unauthorized drivers to upload their photos to other drivers' accounts, endangering passenger safety.

HP Inc. – The computer and printer maker issued a new rejection of Xerox's takeover interest, telling the office equipment maker in a letter that it did not have faith in Xerox's ability to raise enough cash.

Netflix – Wells Fargo downgraded the stock to "underperform" from "market perform" at Wells Fargo, which said the Street is overestimating the video streaming service's free cash flow and also pointed to increasing competition.

General Electric – GE announced that Moller-Maersk CFO Carolina Dybeck Happe will replace Jamie Miller as chief financial officer.

Nvidia – The graphics chipmaker's stock was upgraded to "overweight" from "equal-weight" at Morgan Stanley, which sees the company's gaming and data center markets accelerating in 2020.

Dick's Sporting Goods – The sporting goods retailer's stock was upgraded to "buy" from "neutral" at Bank of America/Merrill Lynch, which said the stock's valuation is compelling in light of the outlook for same-store sales growth.

Amazon.com – Amazon filed a lawsuit contesting the Pentagon's award of a $10 billion cloud computing contract to Microsoft.

Walt Disney – Disney's "Frozen 2" topped the weekend box office with $130 million in North American ticket sales, beating industry predictions.

American Eagle – American Eagle was downgraded to "hold" to "buy" at Loop Capital Markets, pointing to slightly weaker sales and expense pressure for the apparel retailer.

Wendy's – Wendy's was upgraded to "buy" from "hold" at Stifel Nicolaus, which is expressing confidence in the restaurant chain's sales trends and earnings drivers.

Jacobs Engineering – Jacobs reported quarterly profit of $1.48 per share, beating the consensus estimate of $1.32 a share. Revenue beat estimates as well. Jacobs also announced plans to change its corporate name to Jacobs Solutions, to reflect its transition from an engineering and construction firm to a technology solutions company. The change will be effective Dec. 10, and the stock's ticker symbol will change from "JEC" to "J."

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2019-11-25 12:47:00Z
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Uber stopped from operating in London - The - The Washington Post

Henry Nicholls Reuters A photo illustration shows the Uber app and a bus in London, Britain, June 25, 2018.

In a statement, Transport for London (TfL) said that there were “several breaches that placed passengers and their safety at risk.”

Uber’s license expires at midnight on Monday. The company said that it will appeal the decision, and it can continue to operate until a final decision is made.

This is the second time in two years that transport authorities have rejected the ride-hailing app’s bid to renew its operating license in London, one of its largest European markets.

The ride-sharing app, which employs tens of thousands of drivers, is hugely popular with users in London — and unpopular with London’s iconic black cabbies.

Uber said it will appeal the decision and that, for it’s 3.5 million users in London and 45,000 drivers, it will be business as usual during that time. “We have fundamentally changed our business over the last 2 years, setting the standard for safety in the industry. TfL’s decision on our London licence is wrong and we will appeal,” the corporation tweeted.

In September 2017, TfL first dropped the bombshell that it was not going to renew Uber’s license amid safety concerns. The company successfully appealed that decision and was granted an extension.

TfL said that the company had made a number of improvements over the past year but said that one of the key issues was a change to Uber’s system that “allowed unauthorised drivers to upload their photos to other Uber driver accounts.” They said that this allowed at least 14,000 trips where passengers were picked up by someone other than the booked driver.

Sadiq Khan, the mayor of London, said in a statement: “I know this decision may be unpopular with Uber users but their safety is the paramount concern.”

“Regulations are there to keep Londoners safe, and fully complying with TfL’s strict standards is essential if private hire operators want a license to operate in London,” he said.

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Charles Schwab buying TD Ameritrade for $26B in all-stock deal - Fox Business

Charles Schwab Corp. confirmed the acquisition of TD Ameritrade as an all-stock deal for $26 billion.

Charles Schwab is acquiring TD Ameritrade in an all-stock transaction valued at $26 billion, the company announced Monday. TD Ameritrade shares were higher on the news.

Ticker	Security	Last	Change	Change %
AMTD	TD AMERITRADE HOLDING	48.13	-0.25	-0.52%
SCHW	CHARLES SCHWAB	48.20	+0.17	+0.35%

Schwab will pay approximately 1.0837 Schwab shares for each TD Ameritrade share. The deal represents a 17 percent premium to Ameritrade's 30-day volume weighted average price. TD Shareholders will own about 13 percent of the combined company once the deal is complete.

The deal, which was first reported by FOX Business' Maria Bartiromo on Thursday, will create a financial-services behemoth with $5 trillion in assets under management, allowing Schwab to better compete with the likes of BlackRock. The firms generate a combined $17 billion of annual revenue and $8 billion of annual pre-tax profit.

The deal is expected to be 10 percent to 15 percent accretive to earnings and 15 percent to 20 percent accretive to operating cash earnings per share in year three.

"With this transaction, we will capitalize on the unique opportunity to build a firm with the soul of a challenger and the resources of a large financial services institution that will be uniquely positioned to serve the investment, trading and wealth management needs of investors across every phase of their financial journeys,” Charles Schwab President and CEO Walt Bettinger said in a statement.

LOUIS VUITTON PARENT TO BUY LEGENDARY AMERICAN LUXURY BRAND

TD Ameritrade Chief Financial Officer Stephen Boyle will act as the interim president and CEO, helping the company with its fiscal year 2020 plan and integration with Schwab. Boyle will assume leadership effective immediately.

Following the close of the deal, TD Bank will have the opportunity to name two board members and TD Ameritrade will name a director.

The combined company's headquarters will be located in Westlake, Texas.

Outgoing TD Ameritrade CEO Tim Hockey previously acknowledged his firm's decision to adopt zero commissions -- as Schwab and rivals E-Trade and Fidelity have done -- would prompt speculation about mergers.

"We will take a look at anything that makes financial and strategic sense," he said last month, outlining the company's plans to make up for lost revenue of as much as $240 million a quarter from the new commission structure. "Scale is important. We have scale. We're very comfortable with our earnings power now, even in this new environment."

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Schwab said in October that eliminating its $4.95-per-trade commission would trim quarterly revenue by $90 million to $100 million, or about 3 percent to 4 percent of the total.

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2019-11-25 11:06:53Z
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Charles Schwab to buy TD Ameritrade in a $26 billion all-stock deal - CNBC

Charles Schwab on Monday announced plans to buy discount brokerage rival TD Ameritrade in an all-stock deal valued at $26 billion.

As part of the agreement, Ameritrade stockholders will receive 1.0837 Schwab shares for every share held. The deal is expected to close in the second half of 2020.

Shares of TD Ameritrade ticked 1% lower to $47.82 in premarket trading, while Schwab shares fell 2.7% to $46.90.

The merging of the two biggest publicly traded discount brokers will create a mammoth with more than $5 trillion in client assets, $3.8 trillion from Schwab and $1.3 trillion from TD Ameritrade. The combined company will serve more than 24 million clients.

"We believe the combination of our two great companies positions us to be competing and winning in the investment services business for the long run—the very long run," said Charles Schwab president and CEO Walter Bettinger.

The integration of the two firms is expected to take between 18 and 36 months after the deal is closed. The combined company's headquarters will relocate to Schwab's new campus in Westlake, Texas.

The deal will create "a Goliath in Wealth Management," Wells Fargo senior analyst Mike Mayo said in a note to clients on Thursday, when talks of the merger were by CNBC's Becky Quick.

More consolidation in the brokerage industry is expected given the massive amount of disruption that has taken place, with all the major brokers dropping commission fees for trading in recent months. Schwab was the first of the major players to make the move, eliminating commissions in . Schwab's competitors, including Fidelity and TD Ameritrade, were quick to follow.

Andrew Burton | Bloomberg | Getty Images

After dropping commissions, Schwab and TD Ameritrade's stocks were under pressure as investors worried that the lost commission revenue would pressure margins; however, Schwab proved its free trading is paying off in terms of new client accounts. Schwab has a market value of $57.5 billion and TD Ameritrade has a $22.4 billion market cap.

The advantage to the Schwab-TD Ameritrade deal is the brokerage giant will be able to cut costs, stream new revenue opportunities and improve the platform for clients, said JMP Securities analyst Devin Ryan. Given the high amount of overlapping back-office operations and vendor costs, Stephen Biggar, Argus Research Director of Financial Institutions Research, expects to see about 60% of TD Ameritrade's costs removed following the sale.

TD Ameritrade CEO Tim Hockey previously announced he would step down in February 2020. The companies said on Monday they will suspend the CEO search and named TD Ameritrade Chief Financial Officer Stephen Boyle as TD Ameritrade's interim president and CEO.

This particular deal came as a shock to analysts on Wall Street, who pegged E-Trade as the most likely acquisition target among the smaller brokers. Shares of E-Trade ticked about 1% lower in premarket trading.

The deal will likely pressure smaller brokers like Interactive Brokers, as well as Silicon Valley start-up Robinhood who kick-started free stock trading in 2013.

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2019-11-25 11:04:00Z
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Musk suggests Tesla has 200,000 pre-orders for controversial Cybertruck - Fox Business

FOX Business’ Kristina Partsinevelos reports on Tesla’s rollout of their new pickup truck and the issues at the unveiling.

(Reuters) - Tesla Inc Chief Executive Officer Elon Musk indicated in a tweet on Sunday that the electric carmaker received 200,000 orders for its electric pickup truck within three days of its launch.

Musk, who has been regularly tweeting about the Cybertruck's features since its launch late Thursday, has also been updating his followers with the number of orders the company has received.

ELON MUSK DEFAMATION SUIT PRETRIAL HEARING STARTS MONDAY

In an earlier tweet, Musk said the company had received 146,000 orders for Cybertruck, and tweeted again on Sunday saying "200K" - an apparent reference to the number of orders.

The company's website shows that an immediate payment of $100 is required to reserve an order for the Cybertruck, which has a starting price of $39,900.

The launch of its futuristic pickup on Thursday suffered a setback when the electric vehicle's "armored glass" windows shattered in a much-anticipated unveiling. The overall look of the electric vehicle had worried Wall Street on Friday, driving the automaker's shares to close 6.1% lower.

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During the launch, Musk had taken aim at the design, power and durability of mainstream trucks, only to be shaken when his boast about his new vehicle's windows backfired.

Separately, Musk said the Cybertruck is Tesla's last product unveil for a while.

Tesla plans to start manufacturing the Cybertruck around late-2021.

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2019-11-25 10:53:48Z
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