E*Trade, Still Growing Account Base (ETFC)

E*TRADE Financial Corporation (NASDAQ: ETFC) has noted that customer cash and deposits
increased by nearly $1 billion in February, although total retail customer assets including customer cash and securities fell 1.7% month over month to $171 billion.

Total Daily Average Revenue Trades (DART’s) fell 17% month over month due to weaker market trends in February.  While electronic brokers are measured by DART’s as the bogey and that would be a bad number, the more impressive metric here is that E*Trade still generated 43,000 net new accounts in February to end with retail accounts totaling 4.8 million, up 0.9% month over month and 6.1 percent year over year.  If you were sitting here in November, you would have assumed that a run on the bank was a serious risk.

E*Trade has been a recent feature in our weekly "10 Stocks Under $10" newsletter, and it is an active call.

The company did also announce that R. Jarrett Lilien, President and COO will be leaving effective May 16, 2008.  Interestingly enough, E*Trade does not plan to fill the role of President and COO.

Shares of E*Trade are indicated down slightly in early pre-market trading, although we’d accept this as a win so far as it is still adding net accounts.

Jon C. Ogg
March 19, 2008