A look at Thomson/First Call securities analyst ratings and price targets for E*Trade (ETFC) shows that, among eleven brokers surveyed, their mean price target is $10.64. The discount broker, which is in deep trouble, closed today at $4.60.

There is real concern that, even if the retail brokerage accounts from E*Trade can be sold to a rival, probably Schwab (SCHW) or TD Ameritrade (AMTD), the funds would have to go to support the failing company’s banking operation which has a large pool of mortgage-backed assets. It is not clear that common stock holders would get much in this kind of transaction.

Thomson figures show that analysts have mean recommendation of 2.9 on ETFC based on a scale of 1 (strong buy) to 5 (strong sell).

Hard to be so far off the mark. "Sell" ratings must not be very popular.

Douglas A. McIntyre