E*TRADE Financial Corporation (ETFC) lost 65 cents per share in the fourth quarter last year, but they swung to a profit of 20 cents in the fourth quarter of 2013. Analysts were expecting the company to report a profit of 19 cents per share. Revenue for the quarter came in at $447.1 million versus an estimate of $425.81 million. E*TRADE reported a profit of 70 cents per share for the full fiscal year 2013 results.
Remember, E*TRADE was pushed to near-bankruptcy status in the past couple years, so the company has definitely found its footing in the past year. What has helped get things going in the right direction again at E*TRADE? CEO Paul Idzik has done a great job cleaning up the company. Since he arrived one year ago, Idzik has made all kinds of changes at this company. Nearly the entire management team at E*TRADE has been replaced. The market making business was sold off to eliminate $110 million from operating expenses. Additionally, Idzik has made it a top priority to get rid of the company’s loan portfolio, which weighed on it so heavily for such a long time.
E*TRADE’s entire loan portfolio is now just $8.6 billion. Reserve for loan losses at E*TRADE fell to $17.3 million in this quarter, compared to $74.3 million in the same quarter last year. Another big boost to E*TRADE’s earnings was the return of the retail investor. DARTs jumped 25% from the same quarter a year ago to a level of 160,000. That is the highest level of DARTs for the company in two years.
E*TRADE added 22,000 new brokerage accounts in the fourth quarter, ending 2013 with 3 million accounts. Shares of E*TRADE were down slightly following these results, but the stock is up more than 100% in the past 12 months.
For the full fourth quarter 2013 Earnings from E*TRADE click here.