E-Trade’s Growth Momentum Continued In October

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ETFC: E*TRADE Financial logo
ETFC
E*TRADE Financial

After a solid performance across most key metrics in the first three quarters of the year, E-Trade (NASDAQ:ETFC) sustained its growth momentum in October. The brokerage saw a 28% year-over-year rise and 7% month-over-month rise in trading volumes during the month. The acquisition of OptionsHouse in mid-2016 continued to contribute to growth in brokerage accounts and derivative trading volumes, with over 31% of trading volumes attributed to derivatives.

Interest earning assets have also continued their strong growth, in large part due to the rate hikes over recent months and the expectation of further interest rate hike in the year ahead. As E-Trade has a higher yield on its interest earning assets (2.7%) relative to most competitors, rate hikes should drive solid revenue growth for the company. With the likelihood of a series of hikes in 2017, we expect the growth in assets to continue.

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We have a price estimate for E-Trade’s stock of about $43, which is slightly below the market price.

See Our Complete Analysis For E-Trade Here

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