ZenInvestor

Countering the AP's 'E*Trade Financial Earnings Preview'

Nicely said. The 'provisions' for future losses 'may' come in for some increases, but should be more than offset by increased earnings on the brokerage side. Any reduction in short selling activity due to the new rules, and a continued improvement in the earnings should help the stock. The sale of Etrade Canada will further bolster the balance sheet as well.

NYSE Short Interest Hits Record Highs... Again

I agree that the uptick rule elimination has exacerbated the problem. It is a mystery to almost everyone why it was eliminated, but it needs to be restored. One of the reasons is to 'protect' people who in the current market have become addicted to shorting stocks and will suffer losses if the market suddenly turns UP. It was a reasonable rule and one that should be reinstated.

Writedowns and Capital Raised by Financial Firms

What conclusions did you draw from this? Comparing write downs to 'current' market cap only tells me that some stocks may well be 'beaten down' more than they should have, or is that some companies have taken more write downs and therefore are safer from further write downs?

The facts as you have presented them are well known, and thanks for compiling them, but opining on their meaning would have added something to the bare recitation of facts you have presented for us to ponder on our own.

The Current Market Atmosphere: Easy Money Hard to Come by

Well, I got my post censored. I guess if you really LIKE something it stays, but if you simply post anything contrary it disappears. Hmmm. I restate that this is not insightful, just a 'rehash' of old information. Is that so harsh it need to be censored?

Metrics, Mortgages and Analysts

The other obvious from the 'investment banks' is that E*Trade bank is FDIC regulated. They have a layer of reasonableness tests that no Lehman or Bear Stearns ever had to adhere to, and the E*Trade Bank call reports and capital levels are strongly into the well capitalized side.

The reason the 'street' does not see it is fear, and part of that is well founded since many regulated banks were able to hid portfolio issues from regulators through their sheer size and the complexity of the deals. Cindy's point about 'first in, first out' of the crises is well founded. The fact that E*Trade owned up quickly and sold the sub prime to Citadel for a deep discount has set them up to exit the credit crunch early. Q2 will be the real sign that their recovery, if not complete, is well down that road.

S&P Upgrades E*Trade Despite Struggling Financial Sector Peers

This is of course good news to long investors, but it should also sound a warning to the shorts. I agree that losses should be close to ending, and if they have success in swapping debt for equity it could happen much faster and provide stronger results in future quarters, since the service on the debt is a major drag on earnings right now.

This company has been 'beat down' for too long now, and is indeed ready for a 'magic moment'.

E*Trade's 'First In, First Out' Position: Yes, 111M Shorts Can Be Wrong

Yep, quite an accurate recap. Nice job!

As to the point that E*Trade will not exist in its current form, that is irrelevant to me as an investor. I think it is more than possible that they will, that it is indeed 'probable'. What is important to me is that the stock is clearly undervalued at the current share price, and not by a little. So if it is sold to a competitor, taken private, or sold to a foreign bank means little to me, but it is clear that any of these options will yield a strong gain for any investor over the $4 range we sit in currently. If they remain independent, as they are, then the stock will rise to fair value over the next six to twelve months.

In two more quarters the state of the mortgage portfolio at E*Trade will be very clear, but as I view it now they are adequately reserved, regulated by the FDIC (unlike investment banks), and the brokerage business continues to grow and generate cash. I am not the slightest bit worried.

In addition, it is my daily trading platform, and in that regard they are clearly head and shoulders over the competition. I can't wait to load their new mobile platform on my BlackBerry!

Thanks Cindy for another round up of the facts, and don't worry folks, investors in E*Trade all know the checkered history and have factored in the 'risks'. Also, to be sure the 'shorts' have made out well in the last year on their strategy, and trading this stock in the last six months has made me money already. That said I am long and quite comfortable now, for many of the reasons stated in this article.

Citadel Infuses E*Trade with Strong, Experienced Management

uarenaive, what a cute name, your inexperience is showing. Please site a time that Citadel has taken a stock position and 'lost money' on that position. You can't can you? They are a 'hedge fund', so of course they cover their bets, but they don't put billions down for no gain do they? The biggest gain is in stock price appreciation, and IF they did swap debt for equity it would reduce ETFC's operating expense dramatically, push it into almost immediate profitability, and kick up the value of the shares. Now tell me, if the share price goes up who benefits besides Citadel? That would be all of us who hold the shares, for which I would thank Citadel and KG profusely.

You can read the 'call reports' on Etrade Bank at: fdic.gov, and get a feel for the actual performance of their held portfolio. It is performing and well reserved. Also, we don't know how the portfolio that Citadel bought for 27 cents on the dollar is performing, but my 'guess' is that it is throwing off a ton of cash right now. Citadel's interests and mine, as a shareholder are pretty well aligned right now, and rather then 'fearing' their actions I am cheering them on!

Another nice article Cindy!

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

Yes, there will be plenty of 'fresh' faces when ETFC proves the turn around is well established. I can't see the $4.00 price holding too much longer, and their platform, as well as their over 4MM accounts makes this company an enticing target.

Seeking E*Trade's 'Magic Moment'

Well, Yahoo Finance is the playground of the insane, so Cindy you might want to just stay here. I have tried the public 'discussion' boards too, but the flood of wannabee investors who own less than 500 shares of anything just turns any post into a pointless argument.

Good article, and jbmaria you added little but vitriol in your posts. Might want to stick to something you have some knowledge of, but you are not adding a lot of information. On second thought, stick with Yahoo Finance, that seems to suit you.

Seeking E*Trade's 'Magic Moment'

ETFC will make the leap quickly. Sooner or later the distance from the past management teams errors when combined with their steady progress will catch the attention of the analysts. Analysts are always late anyway, but their tardiness has allowed some of us to accumulate ETFC at bargain prices. I am Long and happy as a clam!

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

Yep, right on target. All this hysteria about the 'authorized stock' and the Citadel registration is just that, and recent DARTS, and the continued account acquisition by ETFC makes this a good buy.

The new management team seems to have addressed every outstanding issue, and is making progress on all fronts. Every new executive or director has been an 'upgrade' to the person who left, and a 'plan' appears to emerging to reward the shareholders.

Great article!

E*Trade Primed for a Breakout

If you read my comment above you might know why doubling the shares is a 'good' thing. Just a thought.

E*Trade Primed for a Breakout

The shares are 'authorized' but not 'issued' so there is no dilution at the moment. The stated intention, besides the obvious stock options, etc., in the normal course of business is to 'swap' debt for equity at a discount. They intend to retire 700MM in debt in this fashion. That will reduce their interest expense and speed the return to profitability. They are also selling for cash some 500MM in subsidiaries that no longer fit the long term strategy. If you combine those two events you should have minimal dilutive effect on the stock, AND profits with a more stable balance sheet. All and all, the words and deeds from ETFC have been 'shareholder friendly'.

E*Trade Primed for a Breakout

Shorts beware! This strong platform, with management's newly authorized stock has the ability to swap debt for equity at a discount and with that reduction in interest expense will be profitable in Q3 if not in Q2. They continue to add accounts and have the best platform in the business (I am a customer). Breakout is long overdue and not much sense in thinking this is not a $6 stock and soon!