E-Trade Financial Corporation
Type: Public (NASDAQ)
Industry: Financial Services
Founded: Palo Alto, California, United States
Revenue: 2.22 billion
Website: www.ETrade.com
Company History
E-Trade was founded in 1982 when William Porter and Bernard Newcomb ended the era of ticker tape by creating Trade Plus, in Palo Alto California. In 1991, Trade plus would help to fund E-Trade who would offer trading service through both America Online and CompuServe. This unique medium enabled users to easily buy and sell stocks like never before, live and without a broker. Although its business model was initially questions its revenues quickly quelled investors’ worries as its revenues neared $11 million dollars. Finally with its IPO release in 1996, E-Trade finally went public with the Robertson, Stephens & Company as its lead underwriter. It was then when there name was changed from the E-Trade group, to the E-Trade Financial Co.
Although the late 90s were good to the growing company it would be several acquisitions of their future that would lead to continual success. In 2001 E-Trade would envelop Web Street Securities, a well-known brokerage firm. As E-Trade continued to grow throughout the beginning of the new decade they would also make offers to both Ameritrade and TD Waterhouse. Although both potential mergers dissolved E-Trade would once again make an acquisition in 2005 when they absorbed Harrisdirect, a formal discount brokerage service, and then Brown & Company, the formal discount brokerage service for J.P. Morgan.
Key Facts and Figures:
- E-Trade has been a pioneer in online investing for over 20 years
- They boast 4.3 million customer accounts and $189 billion in customer assets worldwide
- Easy, intuitive online investing
- Five-star 24/7 customer service
- E-Trade Complete Protection Guarantee
- Free education on stock purchases and independent research
Tools for Investment
In addition to allowing investers to very quickly and easily buy and sell stock without the need for a personal broker, E-Trade also gives a variety of tools to investors that many people are not privy to. The first is a variety fundamental company analysis that is obtained through leading sources suc as Thompson Reuters, or S&P. In addition to this E-Trade also offers what they call a “peer company comparison” which allows the users to see how the companies in their portfolio stack up against companies in other industries. E-Trade also allows it users to obtain a full picture of stock prices with an easy to use rating system. This system allows the user to obtain different analysts’ views on any particular stock and therefore better understand the repercussions that the potential ownership of the stock would have on their portfolio.
Financial Summary
E-Trade Financial Corporation is a financial service company who specifically focuses on providing online brokerage and related services and products to individual retail investors. It also provides other products focused specifically on banking, sweep deposits, and savings products. All of these products and services are focused specifically on retail investors. E-Trade has several subsidiaries which include the E-Trade Bank, a fully chartered savings bank that provides banking products specifically focused on nationwide retail investors. The E-Trade bank allows their customers to deposit there capital into accounts insured by the Federal Deposit Insurance Corporation (FDIC). Other E-Trade subsidiaries include E-Trade Clearing LLC, a clearing firm for all of E-Trade’s brokerage subsidiaries. E-Trade Financial Operates in two main segments, the first is trading and investing, and the second is balance sheet management.
Competition
E-Trade’s major competitors include:
Ameritrade
Charles Schwab
Suretrade
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