Demolished E*Trade (ETFC) has climbed back to $3 a share, and, despite yesterday’s massacre in the financial sector, it’s staying there. This may be short covering, it may be hopes and prayers, it may be an imminent takeover bid (Schwab?/CS) or it may be that the stock is finally finding a bottom. Or it may be a head-fake, a prelude to E*Trade’s declaring bankruptcy.
One hopes that if E*Trade had discovered a truly horrific mess hiding in its $12 billion home equity portfolio, it would have been forced to report that by now: E*Trade is still releasing selective data and spinning its press releases, but the failure to disclose a known disaster would vastly increase the company’s legal risks.
As long as a buyer can figure out how to insulate itself from E*Trade’s home equity loans, the brokerage brand and business is attractive. A buyout, therefore, remains a possibility. The company will reveal earnings, home equity details, and its full turnaround plan next week. All eyes on Jan 24.
The Chronicles of E*Trade
Is E*Trade Revisiting its “No Bankruptcy” Vow?
eTrade Still Playing Fast and Loose With Facts?
ex-E*Trade CEO Mitch Caplan Voted 2007 Goat of the Year
E*Trade Tries to Instill Confidence, Fails
Singing the E*Trade Blues: Stock Approaching $3
E*Trade’s Long, Quiet March Toward Zero
How to Destroy a Company in 5 Short Months: An E*Trade Financial Seminar
Cost of E*Trade’s Gambling Debts: $9+ Billion and Counting
E*Trade’s Citadel Deal Cuts Existing Shareholders in Half
E*Trade Saved By Hedge fund Citadel
E*Trade on the Block
E*Trade’s Desperate Ads Crush Stock Again
E*Trade CEO Denies Bankruptcy, Risks Jail Time
E*Trade to Customers: Please Don’t Take Money and Run!
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