Westlake, Texas-based The Charles Schwab Corporation (SCHW) operates as a savings and loan holding company. With a market cap of over $133 billion, Charles Schwab provides various services including wealth management, securities brokerage, banking, asset management, custody, and financial advisory. The capital markets giant is expected to release its Q4 earnings on Wednesday Jan. 15.
Ahead of the event, analysts expect Schwab to report adjusted earnings of $0.88 per share, up a staggering 29.4% from $0.68 per share reported in the year-ago quarter. Furthermore, the company has matched or surpassed analysts’ earnings estimates in each of the past four quarters. Its adjusted EPS for the last reported quarter remained flat at $0.77, exceeding analysts’ estimates by 2.7%.
For fiscal 2024, analysts anticipate Schwab to report an adjusted EPS of $3.12, down marginally from $3.13 in fiscal 2023. Nevertheless, its fiscal 2025 earnings are expected to surge 25% year-over-year to $3.90 per share.
SCHW stock has gained 7.5% over the past 52 weeks, lagging behind the Financial Select Sector SPDR Fund’s (XLF) 28.4% surge and the S&P 500 Index’s ($SPX) 23.8% gains during the same time frame.
Charles Schwab’s stock prices surged 6.1% after the release of its impressive Q3 results on Oct. 15. Driven by healthy net asset gathering and equity market resilience, the company’s total client assets increased by a staggering 26.8% year-over-year to over $9.9 trillion. This has led to a 20.6% year-over-year growth in asset management and administration fees to $1.5 billion.
However, the company’s total net revenues grew by a relatively modest 5.2% compared to the year-ago quarter to $4.8 billion, due to dip in interest revenues and bank deposit account fees. Nevertheless, the company has showcased commendable expense discipline which led to a massive 27.7% year-over-year growth in net income to shareholders, totaling $1.3 billion.
The consensus opinion on SCHW stock is moderately bullish, with an overall “Moderate Buy” rating. Among the 21 analysts covering the stock, 10 recommend “Strong Buy,” two advise “Moderate Buy,” seven suggest “Hold,” one advocate “Moderate Sell,” and one has a “Strong Sell” rating. Its mean price target of $83.45 represents a 12.9% premium to current price levels.
