IBKR - Market gains will help brokers but rates still a drag - Wells Fargo

Wells Fargo is more confident on brokerage stocks going into earnings after the quick recovery of equities, especially with retail investor activity.Analysts led by Christopher Harris are raising EPS estimates and price targets overall in the group."The outlook for our broker coverage has improved since last quarter with much of that improvement attributable to ongoing material equity market appreciation," Harris writes in a note. "At the same time, retail investors remain incredibly active which has been a significant positive for the ebrokers."Retail trading activity for 3Q is forecast to be very strong, up 100% year/year for Schwab and Interactive Brokers, Harris says."Negatively, low interest rates are a challenge for the group", he adds. NIM is seen down 11% q/q for 3Q.Wells Fargo boosts the price target on Interactive Brokers ([[IBKR]], +0.9%) to $45 from $44 with an Underweight rating, Stifel Financial ([[SF]], +2.3%) to $51 from $46 with an Underweight rating and

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Market gains will help brokers, but rates still a drag - Wells Fargo