Wall Street analysts are starting to show some moxie.

First, there was the CIBC World Markets analyst who said that Citigroup needed to raise $30 billion in capital. Now, a Citigroup analyst is questioning whether E*Trade can survive, sending shares of the online brokerage firm plunging 53 percent.

It's a far cry from the start of this decade, when analysts were widely seen as tech-boom cheerleaders for the brokerage sales force or shills for the bankers. A "sell" recommendation was rarer than a sighting of a black swan.

That nod-and-a-wink era ended under a $1.4 billion settlement between the Wall Street banks and the New York attorney general at the time, Eliot Spitzer. As practices changed, however, the reputation of analysts did not immediately improve. Indeed, many Wall Street firms began seeing research simply as a cost center and reduced their coverage as a result.

But things have been slowly changing. The number of sell recommendation has been edging up, accounting for nearly 7 percent of all ratings in 2006, according to the research firm StarMine.

And some analysts have refused to be marginalized.

Michael Mayo of Deutsche Bank Securities, for one, has not been afraid to ruffle the feathers of James Dimon of J.P. Morgan Chase and other top executives. In recent months, he had been calling for Charles Prince to resign from Citigroup.

Shares of Citigroup tumbled 7 percent on November 1 after Meredith Whitney of CIBC released a note to clients that Citigroup would need to cut its dividend, sell assets, and take other steps to shore up its capital.

Whitney told the Times of London that she received several death threats afterward. "People are scared to be negative, especially when a company has such a wide holding," she said.

Now in a report headlined "Bankruptcy risk cannot be ruled out," Prashant A Bhatia, an analyst with Citigroup, has issued a "sell" recommendation on shares of E*Trade.

"The continued negative news flow about charges resulting from its mortgage and C.D.O. [collateralized debt obligation] exposure, an S.E.C. inquiry, and continued deterioration in its financial condition, all increase the likelihood of significant client attrition," the analyst wrote.

His note came after the company said late on Friday that there would likely be additional write-downs on its $3 billion portfolio of asset-backed securities. It also said that is previous profit forecast was no longer reliable.

Bhatia noted that other online brokerages have fared better than E*Trade.

"That peers have virtually entirely avoided the credit crisis, again highlights the flawed strategy and lack of credible risk management by E-Trade's senior executives and the board of directors," he said, adding that there was a 15 percent chance that the company would declare bankruptcy.

E*Trade said today that "We could absorb an immediate write-down in excess of $1 billion and still remain well capitalized."

Jeffrey Cane