This stock was deservedly hammered for investing poorly. Having said that it is both a good growth stock with lots of room for a positive upside. It could also be a takeover target for one of the bigger players. I see this stock sitting at 10.00 per share by March 09.
E*TRADE (NASDAQ: ETFC) is holding up well in this down tape. Shares are currently trading at 3.95 per share and moving towards the top of its falling wedge pattern. ETFC has a large open interest position on the January 2008 7.50 calls, which is most likely being fueled by speculation of a takeover. These calls are still very far out of the money, but that could change overnight if a take over announcement is made.
A group headed by Citadel including Blackrock will be purchasing E-Trade's 3B ABS portfolio for about 800M and will also be taking a 18% stake in E-Trade. Citadel and funds managed by Blackrock will immediately buy 1.6 billion of notes paying an annual interest rate of 12.5%. And Citadel will buy another 150 million of notes and common stock at final closing, expected by Jan. 15, said E-Trade.
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