User 181148

Comparative Price Shopping: Selected Banking, Mortgage and Brokerage Stocks

Run some charts on brokerages to see what happens to them during recession/bear markets.....we are not deep enough into one yet, but it is coming. Look what happened to ETFC during the last recession/bear market, and it was just a brokerage then, without the bank portfolios to drag it down.

Comparative Price Shopping: Selected Banking, Mortgage and Brokerage Stocks

Right, she is focused on something that happened six months ago. Current PPS is because of the upcoming projected loan losses of 1-1.5B two to three years out, and recession threat. Also, the market determines PPS, not any individual. Comparing ETFC PPS to Washington Mutual or Countrywide Financial is a faulty anology. PPS is dependent on many factors such as shares outstanding, debt, book value, etc, etc. When she did that it just showed how shallow her analysis and thinking is.

Comparative Price Shopping: Selected Banking, Mortgage and Brokerage Stocks

Author as a ETFC stock holder needs to get over it and move on. Bhatia's downgrade was six months ago and if it was incorrect the market would have compensated for it by now by giving ETFC a better PPS. Since then ETFC's stock price has done nothing but meander sideways. ETFC is still struggling to raise enough money to cover projected losses of 1-1.5B in the next 2-3 years. So far the Company has only raised about 1/3 of that. Check the provisions for loan losses in the balance sheet for the facts. Also, we are in a recession. In recessions all brokerages suffer, and it will happen again this time. ETFC will recover but not in 2008. ETFC will recover only when the overhang from the loan portfolio is no longer a factor and the recession is fading into the past........