May 1, 2008 / 8:20 PM / 10 years ago

UPDATE 2-Investools says SEC conducts informal inquiry

(Recasts, adds SEC inquiry details)

May 1 (Reuters) - Investools Inc SWIM.O posted a quarterly profit that was below Wall Street estimates and said the U.S. Securities and Exchange Commission was conducting an informal inquiry into some presentations, sending its shares down 20 percent.

The online brokerage and investor education services company said the inquiry was related to certain presentations in some of the seminars the company conducted.

Investools said first-quarter net income was $11.5 million, or 17 cents a share, compared with a net loss of $19.8 million, or 36 cents a share, a year ago.

Analysts expected the company to earn 21 cents a share, excluding items, according to Reuters Estimates.

Revenue rose 66 percent to $91 million, marginally above analysts’ estimate of $90.5 million.

Revenue from brokerage services rose to $42.5 million, while sales transaction volume at the education segment fell 37 percent to $37 million.

The New York-based company’s retail daily average revenue trades -- a key measure of trading activity for retail brokerage firms -- rose to 45,400 from 15,200.

The company said it plans to change its name to thinkorswim Group Inc before the year-end. Investools acquired online brokerage thinkorswim in February 2007.

Shares of the company were trading at $9.95 after the bell. They closed up 7.7 percent at $12.48 Thursday on Nasdaq. (Reporting by Dinesh Nair; Editing by Vinu Pilakkott)

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