Morgan Stanley makes its move

[The beef 675] [I'm an image] "The big question that remains: what is that E-Trade baby doing now that it's all grown up?" - Jeff Hey there carnivores, Markets were down on Thursday, once again due to… you guessed it… coronavirus worries. Today we’re talking Morgan Stanley’s move to buy E-Trade. Keep raging, Jeff & Jason [Image] [I'm an image] Morgan Stanley gets in the weeds Morgan Stanley announced its acquisition of E-Trade yesterday, in what is yet another consolidation in the brokerage industry. Looks like someone wore their deal sleds. The $13B deal, which [is expected to close]( in Q4 of this year, has MS paying $58.74 per share. This announcement will bring together a combined $3.1T in client assets, with E.T.’s portion making up a respectable $360B… which is the equivalent of saying Tom Brady and I have a combined net worth of $180.001M and are dating a model. The reason for the szn MS Chairman James Gorman [promises that the deal]( will be great for its wealth management biz, and acts as another stable source of income. E.T. generates about $56B annually in deposits, something MS would refer to as an “area for improvement.” The main play here, of course, is to convert E-Trade customers to MS ones, which is highly likely since millennials are too damn lazy to cancel anything (see the $60 in Blue Apron that I didn't cancel for the third week in a row). The tie-up will bring together two very different types of clientele, i.e. the older wealthier traders on Morgan Stanley's platform, and the younger, tech-savvy traders who probably still live with the aforementioned MS clients (E-Traders). MS investors didn’t seem to buy in, as shares fell 4.6% on the day. Ok, boomers. E-Trade jumped more than 21% during trading. The bottom line... This deal was essentially made in the shadow of Charles Schwab's $26B acquisition of TD Ameritrade last year, showing that Morgan is fighting scared of Chuck. The end [might soon be near]( for independent discount brokerages (sup TradeStation, FirsTrade), with acquisitions likely continue (looking at you, Goldman Sachs) as fast-growing fintech platforms with their disruptive ideas (zero-commission trades) change the game and attract new money. Thanks, Robinhood. [I'm an image] ☑️ Tongue twister. Stamps.com has turned things around since last year, after shares surged [65% on Thursday](. The rise comes as the stamp-lickers blew estimated earnings out of the water, which was a far cry from last year’s single-day plummet of 50% when it announced it was ending a partnership with the USPS. The company reported an adjusted profit of $2.12 per share, on $160.9M in revenue, while analysts were only expecting a $1.03 return on $144.7M. CEO Ken McBride attributes the recent success to a partnership with UPS that began in October of last year. Can a company that sells stamps be back, if they were never really here in the first place? ☑️ Let’s go somewhere private. Victoria’s Secret is heading back to the world of private equity, after its owner L Brands [reached a deal]( to sell the lingerie brand to Sycamore Partners. It hasn’t been confirmed whether Sycamore waited awkwardly on the mall bench outside while the deal was negotiated. The deal, worth $525M, gives 55% of Victoria’s Secret to Sycamore, while L Brands will retain the remaining 45% so shareholders can benefit in the off chance of recovery. That sound you hear is the collective sigh of relief of Dad’s taking daughters back-to-school shopping. L Brands isn’t just losing its panties in the deal, CEO Les Wexner is also heading for greener pastures, ☑️ 30 minutes or less. Domino’s had its biggest stock jump on record, [spiking 29%]( after sales growth in the US exceeded expectations. Same-store sales grew 3.4% in the quarter that ended January 29th, beating the estimated 2.1% growth. I’m sure the continued push for legal weed had nothing to do with it. The results show that Domino’s efforts to add extra toppings to its delivery and carryout services appear to be working. As opposed to what other pizza services? Domino’s also continues to expand, despite having 6k US locations already. It added net 141 units last quarter in the US. ☑️ Joining forces. Ultimate Software and Kronos are teaming up. The two workplace software providers agreed to a [$22B all-stock deal]( on Thursday, that would combine the companies. Hellman & Friedman owns both firms, and will remain the controlling shareholder. Blackstone Group also owns stakes in both firms, and will now be the largest minority investor in the newly formed company. Aron Ain, the CEO of Kronos, will be tapped to lead the new two-headed dragon, and the companies will each retain their headquarters in Lowell, MA and Weston, FL, respectively. My guess is everyone pushes for meetings to happen in Weston. Combined, the new company will bring in more than $3B in revenue per year. RagingBull, LLC 62 Calef Hwy. #233, Lee, NH 03861 Neither Raging Bull nor RagingBull.com, LLC (publisher of Raging Bull) is registered as an investment adviser nor a broker/dealer with either the U. S. Securities & Exchange Commission or any state securities regulatory authority. Users of this website are advised that all information presented on this website is solely for informational purposes, is not intended to be used as a personalized investment recommendation, and is not attuned to any specific portfolio or to any user's particular investment needs or objectives. Past performance is NOT indicative of future results. 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