lucky lenny

TD Ameritrade And E*Trade: Wedding Bells?

Jeremy, good article. Also, E-trade's marketing costs alone are over $100 million annually - which if u think about it - would be $0 after the takeover & make the combo that much more profitable.

E*Trade: Very Undervalued

Jeremy, here's my analysis on E-trade, which i believe could go to $5-10 over the next 12-24 months:

• Loss provisions are moderating on a quarte-over-qtr basis. Per the 9/15/09 press release, E-trade is projecting a provision for loan loss of between $300-$375 mill; vs. $404.5 mill in 2Q09 - so the provision is moderating

• stock market is back on the upswing; w/ the DOW now over 10k

• despite advertising expense being cut in half, new a/c openings are strong; with a record 2.7 mill brokerage a/c’s as of 8/31/09

• Per the 2Q09 income statement, interest income, commissions, fees, and other revs are tremendous; running around $350 mill/qtr

• E-trade is getting its groove back on. Advertising costs coming down, in 2Q09, only $25.0 mill vs. the usual $44 mill or so. Tells me they’re over the whole meltdown debacle issue.

• Per 2Q09 Balance Sheet, E-trade looks to have enough capitial to weather a few more qtrs & even years of losses; with $6.7 bill in cash & investments; and net equity of $3.0 bill. Not that they’ll have these large losses; just that if they did, they’re still coming back w/out going Chapter 11.

• And finally, the #1 reason, is E-trades 2.7 mill brokerage a/c’s which could lead to a takeover. Even w/ the 662 mill shs o/s (diluted), I think E-trade’s trading platform, name recognition, tax loss carry-forwards, and customer bases would result in an offer of around $5-10/share. Especially if E-trade could become breakeven or profitiable before the buyout.

E*Trade: A Solid, Deep Value Stock

Ricard, here's my analysis on E-trade, which i believe could go to $5-10 over the next 12-24 months:

E-trad is at $1.75. Here’s what I like about the stock and why I’m holding:

• Loss provisions are moderating on a quarte-over-qtr basis. Per the 9/15/09 press release, E-trade is projecting a provision for loan loss of between $300-$375 mill; vs. $404.5 mill in 2Q09 - so the provision is moderating

• stock market is back on the upswing; w/ the DOW now over 10k

• despite advertising expense being cut in half, new a/c openings are strong; with a record 2.7 mill brokerage a/c’s as of 8/31/09

• Per the 2Q09 income statement, interest income, commissions, fees, and other revs are tremendous; running around $350 mill/qtr

• E-trade is getting its groove back on. Advertising costs coming down, in 2Q09, only $25.0 mill vs. the usual $44 mill or so. Tells me they’re over the whole meltdown debacle issue.

• Per 2Q09 Balance Sheet, E-trade looks to have enough capitial to weather a few more qtrs & even years of losses; with $6.7 bill in cash & investments; and net equity of $3.0 bill. Not that they’ll have these large losses; just that if they did, they’re still coming back w/out going Chapter 11.

• And finally, the #1 reason, is E-trades 2.7 mill brokerage a/c’s which could lead to a takeover. Even w/ the 662 mill shs o/s (diluted), I think E-trade’s trading platform, name recognition, tax loss carry-forwards, and customer bases would result in an offer of around $5-10/share. Especially if E-trade could become breakeven or profitiable before the buyout.

An Ameritrade-E*Trade Merger? Not as Crazy as It Sounds

$5 a share for e-trade? That's a joke of a price. E-trade much better off allowing it's profits to normalize & get closer to $20/share imho