Insiders step up at E*Trade (ETFC); E*Trade (NASDAQ: ETFC) “is a high higher-risk trade, so do not bet the house; however, I believe the opportunity is still compelling,” says Ian Cooper in Small Cap Trading Pit.

Insiders step up at ETrade (ETFC); ETrade (NASDAQ: ETFC) “is a high higher-risk trade, so do not bet the house; however, I believe the opportunity is still compelling,” says Ian Cooper in Small Cap Trading Pit.

Feb.04, 2008 in Market Outlook

E*Trade (NASDAQ: ETFC) “is a high higher-risk trade, so do not bet the house; however, I believe the opportunity is still compelling,” says Ian Cooper in Small Cap Trading Pit.

“About 10 insiders are betting heavy that E*Trade Financial will turn itself around this year. The filings are revealed here:

Hayter, director 4,917 at $4.06
Layton, director 245,800 at $4.06
Fisher, director 31,806 at $4.06
Randall, director 29,500 at $4.06
Parks, director 24,586 at $4.06
Raffaeli, director 12,293 at $4.06
Lilien, acting CEO 7,376 at $4.06
Weaver, director 68,843 at $4.06
Brewster, director 24,586 at $4.06
Willard, director 11,942 at $3.98 and 13,058 at $3.99
“And for them to be buying after a one-month triple digit move speaks volumes on confidence, which may explain the latest surge in option volume. Sure, the stock took a major dive in 2007, but that’s because it got itself involved in a business it shouldn’t have been in — subprime.

“Fortunately, as highlighted by insider moves, there’s a good chance the bad news has been factored in. Yes, they posted a loss after a $2.2 billion charge related to the sale of the asset-backed securities portfolio, but the company also unveiled a turnaround plan that could return the company to profitability this year.

“Better still, bullish moves have already been made by the company. In November 2007, for instance, the company sold a part of their mortgage portfolio to Citadel Investment, and secured $2.55 billion cash infusion.

“Plus, it’s exiting its institutional trading business, which means it’ll have more time to focus on retail banking and brokerage operations — something it should have been doing all along.

“As for potential upside, a near-term fill of the $8 gap isn’t out of the question, considering low valuations and attempts at a turnaround. Or, if you prefer options, buy the ETFC July 2008 5 call (EUSGA) up to $1.50.”

Posted Feb 4th 2008 8:15AM by Steven Halpern

http://www.bloggingstocks.com/2008/02/04/insiders-step-up-at-e-trade-etfc/

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