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| Statement |
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| So it continues to be a place of innovation for us, and we think there is still a good bit of opportunity to continue to help build leverage points for advisors in the spirit of helping them run thriving businesses |
| And I think we continue to see our win rates improve despite the lower level of movement |
| As a result, we continue to make solid progress in helping advisors and enterprises solve challenges, and capitalize on opportunities better than anyone else, and thereby serve as the most appealing player in the industry |
| And so if we can sustain higher win rates because we've got a more appealing model, we've gotten better at recruiting matched with the flexibility of our model, I think, we think that positions us well as we go forward |
| So as we look ahead, we continue to be excited by the opportunities we have to help our advisors differentiate and win in the marketplace |
| And I think it's complemented by the solid performance in new store sales where we recruited $31 billion of assets for the quarter |
| That's certainly a solid outcome and reinforces the appeal and the execution quality of the operation day to day |
| Regarding capital management, our balance sheet remains strong |
| So we think, again, that the broader enterprise, large enterprise market is an interesting continued durable growth opportunity for us, both on the bank side and on the broader insurance, if that helps |
| As we look forward, we remain excited about the opportunities we see to continue investing to serve our advisors, grow our business, and create long-term shareholder value |
| As a result, our advisors are both winning new clients, and expanding wallet share with existing clients, a combination that drove solid same store sales in Q3 |
| In closing, we delivered another quarter of strong business and financial results |
| Our third quarter business results led to solid financial outcomes of $3.74 of adjusted EPS, an increase of 19% from a year ago |
| This focus led to strong organic growth in both our traditional and new markets, and we continue to make progress with our Liquidity & Succession solution |
| Doing this well gives us a sustainable path to industry leadership across the advisor experience, organic growth, and market share |
| And I think that’s where we get to what we’re doing this year is having an up level of investment and spend that I think really helps improve our value proposition, our capabilities to our advisors and is one of the drivers of our success in organic growth |
| As a result, this component of our strategy helps contribute to solid growth in our traditional markets, while also expanding our addressable markets |
| Really nice momentum, particularly on net new assets there in the quarter and, I guess, particularly in the corporate RIA |
| And as a result of the appeal of our model and the efficacy of our business development team, we maintained our industry-leading win rates while also expanding the breadth and depth of our pipeline |
| With respect to our new affiliation models, strategic wealth, employee, and our enhanced RAA offering, we delivered our strongest quarter-to-date, recruiting roughly $5 billion in assets in Q3 |
| To summarize, our balance sheet is strong and we are well positioned to drive value through our capital allocation framework |
| I think if you add all of that up and you look out over the intermediate term, if you look at our growing pipeline, the growing sort of appeal of our different affiliation models, the strength of our adviser recruiting matched with the nice complement of bigger mandates in the enterprise marketplace |
| With respect to our performance, we delivered another quarter of solid results, while also continuing to make progress on the execution of our strategic plan |
| This quarter we continued to see the appeal of our model grow due to the combination of our robust and feature-rich platform, the stability and scale of our industry-leading model, and our capacity and commitment to invest back into the platform |
| Now, over the third quarter, we saw strong recruiting in our traditional independent market, adding approximately $13 billion in assets |
| The early feedback from these transitions has been positive as we continue to apply the learnings from previous onboardings to further enhance the experience |
| Looking ahead, we are confident that our industry-leading onboarding experience match with the expanding appeal of our model positions us well as a compelling alternative in this part of the market |
| I think first and foremost, if you look at overall just advisory growth in general, right, you continue to see success and progress we have in both same-store sales and new-store sales across, again, all of our different types of affiliation models |
| Looking ahead, we are encouraged by the momentum and strong pipelines across the enterprise market |
| And we think that certainly positions us long term to capitalize on current large demand that exists today, but the growing demand for advice is going to create more opportunity going forward and our ability to differentiate |
| Statement |
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| So first is the promo expense missed the guidance for the third quarter |
| Given this, we anticipate service and fee revenue will decline by roughly $10 million sequentially |
| And if you go back to some of the proposals in 2016, I think there is the big risk that ultimately you take away choice and that begins to harm low and middle income investors by limiting access to brokerage advice for those smaller retirement accounts, which obviously in systemically it’s not a good outcome |
| Our ICA yield averaged 318 basis points in the quarter, down four basis points from Q2 driven by a decline in floating rate balances |
| With respect to client cash revenue, it was $378 million, down $18 million from Q2 as cash balances declined $3 billion to $47 billion |
| It would be a big unintended influence, which I think you’ll have a lot of pushback and a lot of relevant concern around that potential outcome |
| That said, given all of that look, I think, what we do is challenge ourselves into how do you succeed regardless of the volume of movement |
| So I'd be surprised if we did not see that this year |
| This marked the smallest quarterly decline we've seen this year |
| We ended Q3 with corporate cash of $309 million down $16 million from Q2 |
| As for Q4, based on where client cash balances and interest rates are today, we expect our ICA yield to decline by roughly five basis points due to the mix impact of lower floating rate balances |
| So curious about what drove that |
| 3Q cash levels were down 5%, admittedly more resilient than the sweep deposit decline that we saw of roughly 7% to 10% at peers |
| And of course, it could go down further from here, but I think you're starting to see those resistance levels that we talked about before in those balances |
| And I think if I highlighted a couple of things inside Q3 that maybe are significant to that overall outcome, the first would be we continue to see low levels of attrition in that 1% to 1.5% zone |
| We haven't seen a big move up from that, but it's more sustained and we call it that range down for now |
| And then second, the third quarter is a seasonally high quarter for IRA fees |
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