The E*TRADE baby will remain a solo act.
Shares of the discount broker tumbled 4% on Friday, after the company revealed that it will not be seeking a sale after all.
E*TRADE
When Goldman Sachs
E*TRADE would have certainly looked good on TD AMERITRADE's
Unfortunately, TD AMERITRADE was probably the only suitor that really made sense. Discounting pioneer Charles Schwab
Big-name banks seemed like no-brainer candidates. Why wouldn't they want to reach out to individual investors through one of the industry's most recognizable brands? Unfortunately for Bank of America
The state of the deal
E*TRADE executed a 1-for-10 reverse split last year, catapulting its stock into the double digits. Well, it's back in the single digits again.
The good news here is that E*TRADE is profitable and growing. Analysts see the discounter earning $0.66 a share this year and $0.75 a share next year. The bad news is that Wall Street's profit target for 2012 was as high as $0.97 a share just three months ago. Estimates have also come down sharply for larger rivals TD AMERITRADE and Schwab, so this isn't an E*TRADE-centric downward revision.
The hosed-down outlooks aren't fatal, and this is an industry that can turn on a dime at the first whiff of a sustainable spike in trading activity and improving margins. When it happens, E*TRADE will be there to profit from the move all on its own.
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