Nice news from INVESTools: "3. Sliding E*Trade Ready for a Rally (EGRP)
Investors in online discount broker E*Trade (EGRP) have had
a wild ride of late. In early April 1999, the stock saw a
high above $70 and a low in the mid-$20s before settling
down to the $50s in mid-April. But investors took a hit in
late May as the stock fell below $40 (it closed at $38 on
June 2). Option advisor Bernie Schaeffer says E*Trade is
"currently at an extremely oversold level" and recommends
buying a call as he sees a rally in the cards.
Schaeffer cites a number of reasons for an imminent upturn.
For instance, E*Trade recently bested analyst estimates by
$0.05 per share, buoyed by a 34% increase in new customer
accounts. E*Trade continues to be the top performing stock
on the AMEX Securities Broker Dealer Index (XBD), and
Schaeffer points out that the firm is outdoing the number
two XBD equity by 3x.
Though stock in E*Trade continued its slide this week,
Schaeffer sees the stock holding firm at present levels. He
also sees heavy put open interest at the $40 strike
providing support for the stock. Schaeffer recommends buying
the October 45 call (QGZJI)."
and also, again from INVESTools:
5. Four Momentum Leaders Resisting the Current Correction
(EGRP)
Momentum investor Carlton Lutts is advising against new
buying until the market regains strength. But in the
meantime, he is keeping an eye on four stocks exhibiting
such strong relative performance that they are resisting the
current correction. "In general, the stronger (the relative
performance), the better the outlook for the stock in the
months ahead," Lutts says.
At the top of Lutts' list is the online discount broker
ETrade (EGRP). "While it is much smaller than Charles
Schwab, it is growing much more rapidly," Lutts says. He
notes that sales in the past three quarters have risen 32%,
63% and 126% compared to their respective year-earlier
figures. Management pours all earnings back into expanding
the business, explaining per-share losses for the past three
quarters of $0.09, $0.05 and $0.06.
Perhaps this will help explain to our short friends why EGRP is about to turn around... |
