trending Market Intelligence /marketintelligence/en/news-insights/trending/WfraFKU0-F6UmZlQvwaM_Q2 content
Log in to other products

Login to Market Intelligence Platform

 /


Looking for more?

Contact Us

Request a Demo

You're one step closer to unlocking our suite of comprehensive and robust tools.

Fill out the form so we can connect you to the right person.

If your company has a current subscription with S&P Global Market Intelligence, you can register as a new user for access to the platform(s) covered by your license at Market Intelligence platform or S&P Capital IQ.

  • First Name*
  • Last Name*
  • Business Email *
  • Phone *
  • Company Name *
  • City *
  • We generated a verification code for you

  • Enter verification Code here*

* Required

Thank you for your interest in S&P Global Market Intelligence! We noticed you've identified yourself as a student. Through existing partnerships with academic institutions around the globe, it's likely you already have access to our resources. Please contact your professors, library, or administrative staff to receive your student login.

At this time we are unable to offer free trials or product demonstrations directly to students. If you discover that our solutions are not available to you, we encourage you to advocate at your university for a best-in-class learning experience that will help you long after you've completed your degree. We apologize for any inconvenience this may cause.

In This List

E*TRADE 'open to all discussions' as M&A speculation mounts, CEO says

Street Talk - Ep. 64: Coronavirus jumpstarts digital adoption

Street Talk Podcast

Street Talk - Ep. 63: Deal talks continue amid bank M&A freeze, setting up for strong Q4

Street Talk Podcast

Street Talk - Ep. 62: 'Brutal' outlook for oil demand offers banks in oil patch no relief

Amid Q1 APAC Fintech Funding Slump, Payment Companies Drove Investments


E*TRADE 'open to all discussions' as M&A speculation mounts, CEO says

E*TRADE Financial Corp. is willing to consider a deal as it plots its path forward, though executives expect the online broker to be more competitive in a free-trading landscape.

"While we did not desire the move to zero commissions, it has removed really the final point of differentiation in the marketplace and it substantially improves our competitive position," CEO Michael Pizzi said on an Oct. 17 third-quarter earnings conference call. "We are well aware that possible combinations or alternatives could accelerate shareholder value. If that's the case, we remain open to all discussions as we always have been."

After eliminating commission fees for clients trading U.S. stocks, options and exchange-traded funds online, the New York-based company has found itself once again the subject of a frenzy of M&A speculation.

Larger rivals such as TD Ameritrade Holding Corp. and big investment banks such as Goldman Sachs Group Inc. have historically been some of the most mentioned companies that could look to acquire the smaller E*TRADE, though Goldman Sachs' Chairman and CEO David Solomon recently told analysts the company is not interested in buying an online trading platform. Interactive Brokers Group Inc. Chairman Thomas Peterffy also recently said his company was not going to explore an E*TRADE deal.

E*TRADE's decision to slash commission fees, which was part of an industrywide price war, came nearly a year after Executive Chairman Rodger Lawson expressed confidence about the company's future growth potential. At the time, Lawson and then-CEO Karl Roessner outlined a number of new growth initiatives E*TRADE would be pursuing in the coming years, including mid-teens EPS growth that would double its earnings strength by 2023.

By eliminating commission fees, the company now expects to see an annual hit to its revenues of about $300 million. The company also adjusted its prior earnings expectations, with E*TRADE's Pizzi saying it will now take until 2024 to reach $7.00 EPS rather than 2023 as previously anticipated.

To make up for those lost revenues, Pizzi said the company plans to execute its expense reduction initiatives "with even more vigilance." Among the expense-reduction efforts E*TRADE's top executive outlined was a plan to consolidate its New York City and Jersey City offices by year-end. That move will likely cause a charge of about $10 million in the fourth quarter, but will ultimately lead to about $5 million in annual savings, CFO Chad Turner said on the call.

The elimination of commission fees does level the playing field for E*TRADE against its peers Charles Schwab Corp. and Fidelity Investments too. The company previously charged $6.95 per trade, whereas both Schwab's and Fidelity's commission fees were $4.95.

"What we know today is, our competitive position is substantially improved," Pizzi said. "It's early, but we're seeing a lot of anecdotal stories and evidence of [winning] back some customers."