The moves cheered some analysts, who said E-Trade was stigmatized by the controversy that often seemed to surround Cotsakos.
E-Trade's stock, which has plummeted 93% from its 1999 peak, traded higher for much of Friday after the resignation was announced, before closing unchanged at $4.49 on the New York Stock Exchange.
"I thought it was long overdue," said Rachel Barnard, an analyst at Morningstar Inc. "Cotsakos was a bit of an anachronism from the hype-filled Internet days, and in that sense it was about time the company matured out of that early stage."
Caplan "seems more focused on the fundamentals rather than just go-go-go," she said. "It will also help the company jettison its image of lax governance standards. It gives E-Trade a chance to make a fresh start."
Cotsakos sparked outrage among corporate governance watchers and triggered an investor lawsuit when his 2001 pay package of $78 million -- for a year in which E-Trade's stock fell 53% -- was made public.
The company later reduced the pay package, but the controversy lingered as some critics saw Cotsakos as a symbol of corporate greed.
"The pay package was a hard pill for investors to swallow," said Todd Halky, analyst at Putnam Lovell NBF Securities.
Given their qualms about Cotsakos, Halky added, "a lot of institutions sold their positions, and they may be leery of reinvesting in the company, even with these attractive valuations on the stock."
Halky credited the "visionary" Cotsakos with successfully building E-Trade from a discount brokerage into a diversified financial platform, starting with the acquisition of Telebanc Financial Corp. in 2000. But Caplan, the analyst said, has the knowledge base from his experience in both the banking and brokerage industries to lead the company in its next phase.
Caplan has been with E-Trade throughout its evolution and has worked closely with Cotsakos, Halky noted.
As for Cotsakos, E-Trade's Dotson said, he plans to write business books, teach underprivileged children and mentor young entrepreneurs.
