Web Street, Inc. (Nasdaq: WEBS) picked up 1/4 to close at 3 1/8 Tuesday after the online brokerage said it is on track to post a profit sooner than analysts expected, even though results for the latest quarter were below expectations.
The company said it expects to reach profitability by the first quarter of next year, six months ahead of analysts’ expectations, as it strives to extend its domestic market share and customer base while reducing marketing and advertising costs.
Web Street said it is looking for strategic partnerships to help it grow, a strategy that has worked in Europe and Asia. Partners will be U.S. financial institutions and major Internet companies, according to the company.
Last week, the Deerfield, Illinois-based parent of Web Street Securities said a decline in trading volume due to skittish financial markets contributed to weaker-than-expected results for the second quarter.
However, the company’s conversion to a self-clearing operation will boost results in future quarters, said Web Street Co-Chief Executive Officer Joseph Fox. “Now that we are in control of the entire brokerage process, we are confident that our unique business strategies will allow us to achieve the revenue growth and profits our shareholders desire,” he said.