Nomura Securities Maintains a 'Buy' on E*TRADE (ETFC); Looking For Comfort as CEO Sparks Renewed Speculation

August 16, 2012 9:47 AM EDT
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Price: $36.23 -0.44%

Rating Summary:
    17 Buy, 5 Hold, 2 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 24 | Down: 17 | New: 14
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Nomura Securities maintains a 'Buy' on E*TRADE (NASDAQ: ETFC) price target of $10.50.

Analyst, Keith Murray, said, "E*TRADE’s recent CEO change sparked renewed press talk about a potential sale of the company. We continue to think that E*TRADE will eventually be sold, but a potential buyer will need to feel comfortable taking on E*TRADE’s loan book ($11.8bn as of 2Q12). While the loan book has characteristics that raise eyebrows (110% LTV on the 1-4 family loans, 114% CLTV on the home equity loans, mostly 2005-2007 vintages, over 80% originated by a third party), we want to highlight some of the positive trends that E*TRADE’s book is experiencing. Some signs of improvement in housing prices. E*TRADE’s loans are most heavily concentrated in California (47% of 1-4 family loans and 32% of home equity loans), followed by New York (7% of both the 1-4 family and home equity books) and Florida (also 7% of both the 1-4 family and home equity books)."

For an analyst ratings summary and ratings history on E*TRADE click here. For more ratings news on E*TRADE click here.

Shares of E*TRADE closed at $8.53 yesterday.

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