Internet Investor Report...
2. EARNINGS: E*TRADE
By Scott Greenberg
Related articles: 10.0.0.10
E*Trade (EGRP) reported record second quarter results that outdid Wall
Street estimates, further confirming our belief that the March quarter
will set new records for the eBrokers. However, while we like E*Trade, we
still feel it's on a tier below our buy-rated favorites: Charles Schwab
(SCH), Knight/Trimark (NITE), and TD Waterhouse (TWE).
Highlights of E*Trade's results:
1. Signed up 600,000 new accounts, beating analysts' estimates by 50
percent and bringing the total to 2.6 million;
2. A net loss of $23.2 million, or $0.08 a share, bettering the consensus
of a $0.16 loss.
3. Net revenues rose 152 percent to $407 million, beating the expected
revenues of $330M by 23 percent.
4. Processed a record 229,000 stock trades per day, up from 70,000 a day
in the year-ago quarter and 133,000 a day in the 1Q00. The record
exceeded expectations by 16 percent.
E*Trade's numbers represent the strong upside potential of the sector,
which has been fueled by frenetic online trading and record share volume
on the leading exchanges. Investors pushed more than 1 million stock
trades a day through the Internet in the March quarter, up almost 50
percent from fourth quarter of 1999. Nasdaq volume increased for the
seventh consecutive month in March, reaching 42 billion, a 106 percent
increase from August 1999's volume of 20 billion.
The wild swings in the US stock market this year have spooked individual
investors but significantly benefited the eBrokerage industry. Charles
Schwab has already announced that it expects better-than-consensus
results, and we expect the same from Knight/Trimark on April 19. |
