A New 52-Week High for E*TRADE - Analyst Blog


Shares of E*TRADE Financial Corporation ( ETFC ) crafted a new 52-week high, touching $18.04 at the beginning of the trading session on Nov 11. However, this investment broker closed the session at $17.93, which reflects a solid year-to-date return of 95.1%. The trading volume for the session was 3.67 million shares.

Despite hitting its 52-week high, this Zacks Rank #3 (Hold) stock has plenty of upside left, given its strong estimate revisions over the last 30 days and expected year-over-year earnings growth of 300%.

Growth Drivers

Impressive third-quarter 2013 results - including year-over-year earnings growth and decreased expenses - as well as a strong capital position were the primary growth drivers for E*TRADE.

On Oct 23, E*TRADE reported its third-quarter 2013 earnings of 16 cents per share, improving significantly from a net loss of 10 cents per share in the prior-year quarter. However, results were in line with the Zacks Consensus Estimate.

A year-over-year decrease of 7.8% in core operating expenses and 13.0% rise in total daily average revenue trades (DARTs) were the tailwinds for the quarter. Moreover, the company's capital ratios depict its strong position. However, a 14.9% fall in net revenue acted as the headwind for the quarter.

Further, E*TRADE reduced its balance-sheet risk further. The company's loan portfolio was $9.0 billion at the end of the reported quarter, down 21% year over year.

Estimate Revisions Show Potency

Over the last 30 days, 5 out of 8 estimates for 2013 have been revised upward for E*TRADE, lifting the Zacks Consensus Estimate by 6.3% to 68 cents per share. For 2014, 5 out of 8 estimates moved north, helping the Zacks Consensus Estimate advance 7.7% to 84 cents per share.

Some better performing investment brokers include Evercore Partners Inc. ( EVR ), Interactive Brokers Group, Inc. ( IBKR ) and The Charles Schwab Corporation ( SCHW ). All 3 companies carry a Zacks Rank #2 (Buy).

E TRADE FINL CP (ETFC): Free Stock Analysis Report

EVERCORE PARTNR (EVR): Free Stock Analysis Report

INTERACTIVE BRK (IBKR): Free Stock Analysis Report

SCHWAB(CHAS) (SCHW): Free Stock Analysis Report

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Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

This article appears in: Investing , Business , Stocks

Referenced Stocks: ETFC , EVR , IBKR , SCHW



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