The Charles Schwab Corporation (SCHW), based in Westlake, Texas, operates as a savings and loan holding company. With a market cap of $131.8 billion, Charles Schwab provides various services including wealth management, securities brokerage, banking, asset management, custody, and financial advisory through its subsidiaries. It is expected to announce its fiscal Q2 earnings for 2024 on Tuesday, July 16.
Ahead of the event, analysts expect Charles Schwab to report a profit of $0.76 per share, up 1.3% from $0.75 per share reported in the year-ago quarter. The company has consistently surpassed Wall Street’s EPS estimate over the past four quarters.
Its adjusted EPS for the last reported quarter declined 20.4% year over year to $0.74 but surpassed the consensus estimate by 1.4%.
Looking ahead to fiscal 2024, analysts expect Charles Schwab to report an EPS of $3.25, up 3.8% from $3.13 in fiscal 2023. Its fiscal 2025 EPS is projected to grow 35.4% annually to $4.40.
SCHW stock has gained 7.5% on a YTD basis, underperforming the S&P 500 Index’s ($SPX) 15.8% gains and S&P 500 Financials Sector SPDR’s (XLF) 10.6% returns over the same time frame.
Interest revenue is Charles Schwab's primary source of revenue, and fluctuations in interest rates have a massive impact on its financials. Due to the prevailing interest rate levels, Charles Schwab saw a massive 37.1% increase in its Q1 interest expenses while it saw a 1.9% decline in interest revenue. This led to an overall 7.4% fall in total net revenue. However, the company has shown resilience in other avenues and has reported an impressive 20.6% increase in asset management and administration fees.
SCHW stock rose 1.7% on April 15 after the release of its Q1 earnings. The company also exceeded both bottom-line and top-line consensus estimates, fueled by rising equity markets and increased client engagement.
The consensus opinion on Charles Schwab stock is moderately bullish, earning a “Moderate Buy” rating overall. Out of the 19 analysts covering the stock, 11 recommend a “Strong Buy,” one suggests a “Moderate Buy,” five analysts are playing it safe with a “Hold,” one gives a “Moderate Sell,” and the remaining one advises a “Strong Sell.”
The average target price for Charles Schwab is $77.06, indicating a potential upside of 3.9% from the current price levels.
On the date of publication, Sristi Jayaswal did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
