E*TRADE Gains On Leadership Transition, Deal Completion
Zacks Investment Research | Sep 13, 2016 04:09AM ET
E*TRADE Financial Corporation’s (NASDAQ:ETFC) gained around 2.5% to close at $27.20, following the announcement of a management shakeup. The leadership changes followed the closure of the acquisition of online options broker, OptionsHouse, a subsidiary of Aperture New Holdings, Inc.
New CEO Named
Karl A. Roessner has been appointed the Chief Executive Officer (CEO) and will join E*TRADE’s Board. He will be succeeding Paul T. Idzik, who has been the CEO since Jan 2013. Roessner had joined E*TRADE in 2009, and has been serving as its Executive Vice President and General Council over the past seven years.
Additionally, Rodger A. Lawson, Chairman of Board, has been elevated to Executive Chairman of E*TRADE.
Further, Michael Curcio, former CEO of Aperture New Holdings, will be the Chief Brokerage Officer, while Kevin T. Kabat will serve as the Lead Independent Director. Michael had served as E*TRADE’s President before he left the company in 2013.
Why the Shakeup?
E*TRADE announced the leadership change with a view to better align the company for growth.
The company announced the completion of OptionsHouse transaction for a cash consideration of $725 million. The agreement was entered in Jul 2016.
The Executive Chairman of E*TRADE said, "With the OptionsHouse transaction drawn to a close, we have a significant opportunity to reconfigure the Company's leadership to better focus on growing the business both organically and inorganically."
The company anticipates fortifying its derivatives capabilities as well as expanding its customer base with the joining of OptionsHouse’s active, derivative-centric traders. As announced earlier, the company expects the transaction to be relatively neutral to earnings in 2017, but is anticipated to be accretive in 2018.
Further, Roessner said, “With leadership firmly installed, on a parallel track, we will continue pursuing capital deployment initiatives through balance sheet growth, share repurchases, and additional acquisitions, should we find attractive opportunities that offer value to the business and compelling returns for our shareholders".
E*TRADE provides financial services like online brokerage and related banking products and services to retail investors. The company’s strength lies in its revenue growth and expanding profit margins.
Currently, E*TRADE Corporation carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the same space include Yintech Investment Holdings Ltd. (NASDAQ:YIN) sporting a Zacks Rank #1 (Strong Buy), Evercore Partners (NYSE:EVR) and Greenhill & Co., Inc. (NYSE:GHL) , both holding a Zacks Rank #2 (Buy). You can see Zacks Investment Research
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.