Zacks Investment Research upgraded shares of Charles Schwab (NYSE:SCHW) from a hold rating to a buy rating in a research report report published on Thursday. They currently have $52.00 price objective on the financial services provider’s stock.
According to Zacks, “Schwab’s shares have outperformed the industry in the past six months. The company has an impressive earnings surprise history, having surpassed the Zacks Consensus Estimate in each of the trailing four quarters. Its fourth-quarter 2018 results were driven by a rise in interest income and trading revenues. While the company remains well positioned to gain from the rising rate environment and its initiatives to strengthen trading income, continuously rising operating expenses remain a major concern and hurt bottom-line growth to some extent. Further, its enhanced capital deployment actions reflect a strong balance sheet position. Also, the company’s efforts to improve operating efficiency will go a long way to support profitability.”
A number of other equities analysts have also commented on the stock. Barclays reduced their price target on shares of Charles Schwab from $65.00 to $57.00 and set an overweight rating on the stock in a research report on Monday, October 22nd. Credit Suisse Group reduced their price target on shares of Charles Schwab from $56.00 to $53.00 and set an outperform rating on the stock in a research report on Friday, October 26th. Deutsche Bank upgraded shares of Charles Schwab from a hold rating to a buy rating and boosted their price target for the company from $52.00 to $54.00 in a research report on Tuesday, October 30th. Raymond James upgraded shares of Charles Schwab from a market perform rating to an outperform rating and set a $54.00 price target on the stock in a research report on Tuesday, October 30th. They noted that the move was a valuation call. Finally, Morgan Stanley reduced their price target on shares of Charles Schwab from $66.00 to $60.00 and set a buy rating on the stock in a research report on Wednesday, November 14th. Eight equities research analysts have rated the stock with a hold rating and nine have assigned a buy rating to the company’s stock. Charles Schwab has an average rating of Buy and a consensus target price of $54.31.
Charles Schwab (NYSE:SCHW) last posted its earnings results on Wednesday, January 16th. The financial services provider reported $0.65 earnings per share for the quarter, beating the Zacks’ consensus estimate of $0.64 by $0.01. The business had revenue of $2.67 billion for the quarter, compared to analysts’ expectations of $2.64 billion. Charles Schwab had a net margin of 34.61% and a return on equity of 20.28%. The firm’s revenue for the quarter was up 19.0% on a year-over-year basis. During the same quarter in the previous year, the firm posted $0.44 earnings per share. As a group, research analysts anticipate that Charles Schwab will post 2.81 earnings per share for the current fiscal year.
Charles Schwab declared that its Board of Directors has initiated a share buyback program on Thursday, October 25th that authorizes the company to buyback $1.00 billion in outstanding shares. This buyback authorization authorizes the financial services provider to repurchase up to 1.7% of its stock through open market purchases. Stock buyback programs are typically a sign that the company’s management believes its shares are undervalued.
The company also recently declared a quarterly dividend, which will be paid on Thursday, February 28th. Shareholders of record on Thursday, February 14th will be given a $0.17 dividend. The ex-dividend date is Wednesday, February 13th. This is a positive change from Charles Schwab’s previous quarterly dividend of $0.13. This represents a $0.68 dividend on an annualized basis and a yield of 1.52%. Charles Schwab’s payout ratio is 21.22%.
In related news, insider Walter W. Bettinger bought 124,669 shares of Charles Schwab stock in a transaction dated Wednesday, December 26th. The shares were bought at an average cost of $38.81 per share, for a total transaction of $4,838,403.89. Following the completion of the transaction, the insider now owns 335,093 shares of the company’s stock, valued at $13,004,959.33. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is accessible through this hyperlink. Also, CEO Walter W. Bettinger bought 93,090 shares of Charles Schwab stock in a transaction dated Monday, December 24th. The shares were bought at an average price of $39.09 per share, for a total transaction of $3,638,888.10. Following the completion of the transaction, the chief executive officer now directly owns 335,093 shares of the company’s stock, valued at approximately $13,098,785.37. The disclosure for this purchase can be found here. Insiders have sold 641,652 shares of company stock worth $30,138,896 over the last quarter. 11.50% of the stock is owned by company insiders.
Several hedge funds have recently made changes to their positions in the company. Nikko Asset Management Americas Inc. lifted its position in shares of Charles Schwab by 4.9% during the fourth quarter. Nikko Asset Management Americas Inc. now owns 851,642 shares of the financial services provider’s stock worth $35,369,000 after purchasing an additional 40,061 shares in the last quarter. Armor Investment Advisors LLC acquired a new position in shares of Charles Schwab during the fourth quarter worth approximately $201,000. Utah Retirement Systems lifted its position in shares of Charles Schwab by 0.3% during the fourth quarter. Utah Retirement Systems now owns 224,032 shares of the financial services provider’s stock worth $9,304,000 after purchasing an additional 600 shares in the last quarter. National Asset Management Inc. lifted its position in shares of Charles Schwab by 1.7% during the fourth quarter. National Asset Management Inc. now owns 22,317 shares of the financial services provider’s stock worth $929,000 after purchasing an additional 369 shares in the last quarter. Finally, Madison Investment Holdings Inc. lifted its position in shares of Charles Schwab by 34.0% during the fourth quarter. Madison Investment Holdings Inc. now owns 667,481 shares of the financial services provider’s stock worth $27,720,000 after purchasing an additional 169,393 shares in the last quarter. Institutional investors own 79.78% of the company’s stock.
About Charles Schwab
The Charles Schwab Corporation, through its subsidiaries, provides wealth management, securities brokerage, banking, asset management, custody, and financial advisory services. The company operates through two segments, Investor Services and Advisor Services. The Investor Services segment provides retail brokerage and banking services, retirement plan services, and other corporate brokerage services; equity compensation plan sponsors full-service recordkeeping for stock plans, stock options, restricted stock, performance shares, and stock appreciation rights; and retail investor, retirement plan, and mutual fund clearing services.
Further Reading: What is the Dow Jones Industrial Average (DJIA)?
For more information about research offerings from Zacks Investment Research, visit Zacks.com
Receive News & Ratings for Charles Schwab Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Charles Schwab and related companies with MarketBeat.com's FREE daily email newsletter.