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E*TRADE Financial's (ETFC) CEO Gets a Warning from Board

Karl Roessner, CEO of E*TRADE Financial Corporation ETFC, has been asked by the board to come up with a strategy to uplift the firm by the end of next year or else there might be possibility of a sale. The news was first reported by The Wall Street Journal.

The board has also asked Roessner to boost the company’s mix of derivatives and managed products. Further, he told the Journal that he has to improve E*TRADE Financial’s net new brokerage asset and account growth rates by 2–3% each.

Since his appointment in Sep 2016, Roessner has been taking steps to return the company to its former position as a technologically advanced brokerage firm. Also, he launched an advertising campaign in order to attract investors, per the report.

Previously, the company disclosed its target to increase the derivatives mix to 35% of DARTs. It also set managed account assets under management target of $6 billion to be achieved within the next two years.

Further, last year, the brokerage firm acquired OptionsHouse, an online options broker, with a view to bolster its derivatives platform.

In the first quarter, E*TRADE Financial’s total DARTs had increased 25.5% year over year. The uptrend continued in the first two months of the second quarter. Also, the quarter witnessed 5% year-over-year growth in the derivative mix to 29% of DARTs.

The company’s shares have gained 5.7% over the last six months, outperforming the Zacks categorized Financial – Investment Bank industry’s decline of 4.1%.

Currently, E*TRADE Financial carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Other Stocks to Consider

Interactive Brokers Group, Inc.’s IBKR earnings estimates have been revised 1.5% upward for the current year, in the past 60 days. Also, its share price has jumped 11.1%, over the last one year. It carries a Zacks Rank #2.

Raymond James Financial, Inc. RJF witnessed an upward earnings estimate revision of 1.4% for the current year, in the past 60 days. Also, its share price has gained 72.2%, over the last one year. It also carries a Zacks Rank #2.

WisdomTree Investments, Inc. WETF holds a Zacks Rank #2. It saw an upward earnings estimate revision of 4% for the current year, in the past 60 days. Also, its share price has seen an 11.4% rise over the last one year.

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E*TRADE Financial Corporation (ETFC): Free Stock Analysis Report
 
Interactive Brokers Group, Inc. (IBKR): Free Stock Analysis Report
 
Raymond James Financial, Inc. (RJF): Free Stock Analysis Report
 
WisdomTree Investments, Inc. (WETF): Free Stock Analysis Report
 
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