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Charles Schwab
(NYSE:SCHW)
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Rating:71Outperform
Price Target:
$107.00
▼(-4.69% Downside)
Action:Reiterated
Date:10/15/26
SCHW scores well overall primarily due to strong financial performance (high margins, improving ROE, and improved leverage) and a very positive earnings outlook (record results, NIM expansion, and sizable operating leverage). The score is held back by weak near-term technicals (below major moving averages with negative MACD) and mixed cash-flow consistency (sharp YoY FCF decline and volatile operating cash flow), while valuation is supportive but not a major catalyst (P/E ~17.5, ~1.27% yield).
Positive Factors
Strong client and asset growth
Rapid client acquisition and asset gathering strengthen Schwab’s recurring revenue base across brokerage, advisory, and banking. Continued inflows can deepen relationships, expand fee-bearing balances, and provide more client cash to support net interest income and future cross-selling.
Negative Factors
Volatile cash conversion
Uneven cash generation makes reported profitability less predictable as a funding source for investment, capital returns, and balance-sheet needs. The sharp free-cash-flow decline and historical operating volatility indicate earnings may not consistently translate into cash over the next several quarters.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong client and asset growth
Rapid client acquisition and asset gathering strengthen Schwab’s recurring revenue base across brokerage, advisory, and banking. Continued inflows can deepen relationships, expand fee-bearing balances, and provide more client cash to support net interest income and future cross-selling.
Read all positive factors
Charles Schwab Key Performance Indicators (KPIs)
Any
Income Before Taxes by Segment
Breaks down pre-tax profits by business line, highlighting the most profitable parts of the company and where cost or revenue pressures could hit overall earnings.
Breaks down pre-tax profits by business line, highlighting the most profitable parts of the company and where cost or revenue pressures could hit overall earnings.
Data provided by:
The Fly
The FlyCharles Schwab (SCHW) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$155.17B
Dividend Yield1.37%
Average Volume (3M)9.12M
Price to Earnings (P/E)15.2
Beta (1Y)0.83
Revenue Growth12.30%
EPS Growth37.56%
CountryUS
Employees33,900
SectorFinancial
Sector Strength70
IndustryFinancial - Capital Markets
Share Statistics
EPS (TTM)5.89
Shares Outstanding1,729,335,700
10 Day Avg. Volume10,364,764
30 Day Avg. Volume9,124,527
Financial Highlights & Ratios
PEG Ratio0.38
Price to Book (P/B)3.58
Price to Sales (P/S)6.40
P/FCF Ratio20.20
Enterprise Value/Market Cap0.91
Enterprise Value/Revenue4.52
Enterprise Value/Gross Profit5.21
Enterprise Value/Ebitda9.29
Forecast
1Y Price Target
$116.29Price Target Upside3.58% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering18
EPS Forecast (FY)6.45
Revenue Forecast (FY)$28.13B
Charles Schwab Business Overview & Revenue Model
Company Description
The Charles Schwab Corporation (SCHW) stands as a prominent financial services enterprise, delivering a comprehensive suite of offerings that encompass wealth management, securities trading and brokerage, banking services, asset administration, cu...
How the Company Makes Money
Schwab generates revenue from a mix of net interest income, asset-based fees, trading-related revenue, and other service fees tied to its brokerage, advisory, asset management, and banking activities. (1) Net interest income is a major driver: Sch...
Charles Schwab Earnings Call Summary
Earnings Call Date:Oct 15, 2026
(Q3-2026)
| % Change Since: |
Next Earnings Date:Jan 19, 2027
Earnings Call Sentiment Positive
The call was strongly positive, characterized by record revenue and earnings, broad-based client and asset growth, expanding margins, strong capital levels, and substantial momentum in wealth, lending, trading, and AI. Management also expressed confidence in continued NNA growth, fourth-quarter performance, NIM expansion, and long-term operating leverage. The main challenges were higher volume-related expenses, loan growth outpacing deposits, operational limits on the rapidly growing long/short program, and limited current demand for after-hours trading, but these issues were presented alongside active management responses rather than as broad deterioration.Positive Updates
Record Client Acquisition and Asset Growth
Clients opened 1.2 million brokerage accounts in the third quarter. Core net new assets reached $190 billion, up 38% year over year and representing an annualized organic growth rate of nearly 6%.
Negative Updates
Higher Operating Expenses
Adjusted expenses were approximately $3.2 billion, up 9% from 3Q25. The increase reflected strong client engagement and higher volume-related costs, including performance-based compensation.
Read all updates
Q3-2026 Updates
Positive
Negative
Record Client Acquisition and Asset Growth
Clients opened 1.2 million brokerage accounts in the third quarter. Core net new assets reached $190 billion, up 38% year over year and representing an annualized organic growth rate of nearly 6%.
Read all positive updates
Company Guidance
For the remainder of 2026, Schwab expects continued cash build through net new assets and the normal seasonal inflow through year-end, strong full-year revenue growth and NIM expansion, with revenue and full-year NIM expected to grow towards the lower end of the ranges provided at the summer business update, expenses at the low end of the range, and approximately 800 basis points of positive operating leverage, roughly double what was expected at the beginning of the year; fourth-quarter NIM is expected to show roughly 25 to 30 basis points of NIM expansion that year over year for 4Q25 to 4Q26, with further expansion from there in 2027, while the company expects to end 2027 with strong business momentum, continue investing in growth and other key strategic initiatives, and deliver positive operating leverage across a range of environments, with a more detailed 2027 financial scenario expected at the winter business update in January.Charles Schwab Financial Statement Overview
Summary
Income Statement
86
Very Positive
Balance Sheet
74
Positive
Cash Flow
58
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 31.15B | 27.68B | 26.00B | 25.52B | 22.31B | 19.00B |
| Gross Profit | 27.06B | 23.92B | 19.61B | 18.84B | 20.76B | 18.52B |
| EBITDA | 15.16B | 12.82B | 9.13B | 7.72B | 10.64B | 8.88B |
| Net Income | 10.64B | 8.85B | 5.94B | 5.07B | 7.18B | 5.86B |
Balance Sheet | ||||||
| Total Assets | 520.70B | 491.00B | 479.84B | 493.18B | 551.77B | 667.27B |
| Cash, Cash Equivalents and Short-Term Investments | 68.50B | 108.11B | 124.70B | 149.25B | 188.03B | 453.03B |
| Total Debt | 40.00B | 30.95B | 45.13B | 59.08B | 37.88B | 23.77B |
| Total Liabilities | 469.20B | 441.57B | 431.47B | 452.22B | 515.16B | 611.01B |
| Stockholders Equity | 51.40B | 49.42B | 48.38B | 40.96B | 36.61B | 56.26B |
Cash Flow | ||||||
| Free Cash Flow | 3.31B | 8.76B | 2.05B | 18.89B | 1.09B | 1.20B |
| Operating Cash Flow | 3.79B | 9.31B | 2.67B | 19.59B | 2.06B | 2.12B |
| Investing Cash Flow | -7.58B | 24.54B | 35.43B | 57.41B | 32.05B | -75.66B |
| Financing Cash Flow | 11.03B | -29.70B | -47.06B | -61.24B | -68.72B | 96.32B |
Charles Schwab Technical Analysis
Negative
112.27
Price Trends
102.24
Negative
100.56
Negative
97.42
Negative
Market Momentum
-3.24
Positive
28.89
Positive
15.01
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SCHW, the sentiment is Negative. The current price of 112.27 is above the 20-day moving average (MA) of 94.78, above the 50-day MA of 102.24, and above the 200-day MA of 97.42, indicating a bearish trend. The MACD of -3.24 indicates Positive momentum. The RSI at 28.89 is Positive, neither overbought nor oversold. The STOCH value of 15.01 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SCHW.
Charles Schwab Risk Analysis
Charles Schwab disclosed 23 risk factors in its most recent earnings report. Charles Schwab reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Charles Schwab Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $14.21B | 9.96 | 28.42% | 2.57% | 44.47% | 39.64% | |
71 Outperform | $155.17B | 15.23 | 21.29% | 1.43% | 12.30% | 37.56% | |
68 Neutral | $83.47B | 40.19 | 22.70% | ― | 39.14% | 14.06% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
64 Neutral | $288.18B | 14.47 | 17.86% | 2.29% | 15.75% | 29.33% | |
63 Neutral | $260.10B | 12.68 | 17.90% | 2.08% | 7.50% | 41.36% | |
56 Neutral | $24.98B | 25.20 | 18.45% | 0.38% | 38.82% | -14.48% |
* Financial Sector Average
SCHW
Charles Schwab
89.73
-3.91
-4.18%
LPLA
LPL Financial
317.23
-24.96
-7.29%
MS
Morgan Stanley
183.49
21.15
13.03%
GS
Goldman Sachs Group
893.28
118.53
15.30%
FUTU
Futu Holdings
101.34
-77.88
-43.46%
HOOD
Robinhood
92.84
-53.02
-36.35%
Charles Schwab Corporate Events
Business Operations and StrategyPrivate Placements and Financing
Charles Schwab Raises $2.6 Billion in Senior Notes
Positive
Aug 12, 2026
On August 12, 2026, The Charles Schwab Corporation issued $1.25 billion of 5.108% fixed-to-floating rate senior notes due 2032 and $1.35 billion of 5.655% fixed-to-floating rate senior notes due 2037, raising approximately $2.582 billion in net pr...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.