Does anyone know the amount of losses for ETFC over the last 18 months? I know it is in the Billions.
This tax loss carry is worth 35 cents on the dollar against future earnings. It is unlikely ETFC alone can take advantage of these loss provisions however Ameritrade or Chuck might be able to take full advantage of them hence the value to all parties in an aquisition.
It makes no sense to be short here and I know there is a hugh short position. The stock market is getting stronger and with no real downside at these levels and the risk of an aquisiton of E-Trade should push up the trading value.
Just my opinion, I would hate to be short here.
If you recall Warren buffettwas trying to purchase FNM's tax loss carry forward for 3- some billion dollarsso there is tax loss is certainly on the minds of corporations as profits continue to climb.
acquiring company cannot take full benefit of acquired company's tax loss...carryback or carryforward. Additionally, Etrade deferred tax asset is a moving target until they actually "book" losses. You cannot take "tax" losses for provisions against future chargeoffs.