Against All Odds, E*TRADE Keeps Growing (ETFC)

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E*TRADE FINANCIAL Corporation (NASDAQ: ETFC) has been hit much harder than other financial institutions and the last two weeks have been rather challenging  for the company and its shareholders.  This morning we are seeing some stabilizing data.  The company’s gross new retail accounts opened in October were 131,475 with net new retail accounts of 63,538.

It is also seeing an increase in trading activity.  Its DART’s, orTotal Daily Average Revenue Trades, rose by 15% from September levelsto 248,817.  Net new customer asset flows of $1.6 billion in Octoberwere double September levels.

E*TRADE’s total end-of-period retail accounts were listed as 4,499,763.  The company is seeing the same trend as at other firms with a drop incustomer assets (crashing markets tend to do that).  E*TRADE’s totalretail customer assets declined $22.8 billion from September to total$119.4 billion.

This net account adds for October was E*TRADE’s best month in over fiveyears.  It also looks like customers arecontinuing to reduce their margin.

Apparently, we are not the only ones who think these shares have beenhit too hard of late and that these are impressive metrics consideringhow the state of the economy.  Shares are up 8% at $1.35 before the market opens, which isstill at the very bottom of the $1.21 to $6.04 trading range over thelast 52-weeks.

Jon C. Ogg
November 19, 2008