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 Financial Corporation Q3 2009 Earnings Call Transcript

Here’s what looks good:

o Year-to-date we have in fact recorded our highest DART level for the first nine months of any year at 204,000.

o margin receivables at quarter end rose by 10% to $3.4 billion

o brokerage is still growing - record 2.7 mill a/c’s

o working on things like “first call resolution” and brokerage account attrition rate

o Loss provisions are moderating - $347 mill in 3Q09

o tax-deferred net operating losses amounted to $1.6 which they expect to be used when they become profitable

o from all indications, E-trade is getting back to its roots. Making $$’s on interest rate spreads & commissions.

o Projecting profitability & using up their tax-deffered losses

E*TRADE Financial Corporation Q3 2009 Earnings Call Transcript

Ricard, c'mon, they're all like this. How can u complain. This is a freee service & something we never had before.


On Oct 28 03:01 AM Ricard wrote:

> Thanks for the quick response.
>
> And thanks again for providing these...very handy. :)
>
> On Oct 28 02:42 AM Rachel Tova Rott wrote:

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.

E*Trade Shows Bullish Signals

Jeremy, not sure about beating the qtr's .08 loss estimate. However, E-trade 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.

Citadel's E*Trade Stake: The Selling Continues

And your point is....

E*Trade: The Changing Face of Internet Advertising

Judy, all good points. I think E-trade is so overspending on advertising it borders on the obscene. Per Etrade’s latest release, they spent a staggering $175.3 mill on advertising & marketing in 2008. That’s even higher than the $138.7 mill they spent the year before. Granted, E-trade is experiencing record growth. However, E-trade is also recognized as having one of the best trading platforms; which doesn’t ever seem to go down when others - such as TD Ameritrade & Schwab - are having problems. In summary, I think E-trade can seriously ratchet down spending. Their product & word of mouth will more than bring customers to them.

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

E*TRADE FINANCIAL Corporation Q2 2008 Earnings Call Transcript

Anyone notice this $300 million freebie that e-trade rec'd. It's not profit. It's just a tax refund. This is huge & i'm not sure why it's not getting much talk:

"Continuing the discussion on tax, our losses in 2007 permitted us to file for a refund of taxes paid in 2005 and 2006. During the second quarter we received this refund, which was approximately $300 million. This cash was due principally to the bank and therefore did not impact our corporate cash flow."

E*TRADE FINANCIAL Corporation Q2 2008 Earnings Call Transcript

I like that E-trade doesn't need to raise any capital & is aggressively managing bad loans. As an illustrative example from the transcript:

"As we've defined previously, these efforts include partnering with our loan servicers to increase their effectiveness, increasing our loss recovery efforts, and increasing our efforts to put back loans to sellers where the original representations of the seller are not matched by the facts of the loans themselves. We put back $17 million in loans this quarter, a total of $44 million year-to-date."

Who Will Trigger E*Trade's Magic Moment - and a 111.4M Short Squeeze?

Not only a "fresh buyer" - i'm looking for a fullblown merger w/ AMTD or Schwab - the need to merge is compelling

E*Trade: What the Analysts and News Haven't Told You

Nice analysis - I also thought the negative press about the registering of securities was a joke - just like Cindy says - it's a formality - doesn't mean anyhting good or bad.

Schwab, E*Trade: Monthly Activity Comparison and the Industry Average

Great analysis & it shows why E-trade should be an acquisition target in the next months.