Erste Group Bank Predicts Weaker Earnings for Charles Schwab

Key Points

• Erste Group Bank lowered its FY2027 earnings estimate for Charles Schwab to $7.89 per share from $7.96, though the revised forecast remains above the broader consensus estimate of $6.41.
• Analyst sentiment remains favorable, with 18 Buy ratings, five Holds and one Sell; the stock has a consensus rating of “Moderate Buy” and an average price target of $120.18.
• Charles Schwab recently reported quarterly EPS of $1.69, beating expectations, while revenue rose 16.9% year over year to $7.17 billion. The company also declared a quarterly dividend of $0.32 per share, representing a 1.4% yield.

The Charles Schwab Corporation (NYSE:SCHW - Free Report) - Erste Group Bank dropped their FY2027 earnings estimates for shares of Charles Schwab in a report released on Wednesday, October 21st. Erste Group Bank analyst S. Lingnau now expects that the financial services provider will post earnings of $7.89 per share for the year, down from their previous estimate of $7.96. The consensus estimate for Charles Schwab's current full-year earnings is $6.41 per share.

Several other analysts have also recently weighed in on the company. Rothschild & Co Redburn boosted their price target on Charles Schwab from $114.00 to $120.00 and gave the company a "neutral" rating in a research note on Monday, September 21st. Raymond James Financial reissued an "outperform" rating and issued a $145.00 price objective (up from $137.00) on shares of Charles Schwab in a report on Thursday, October 15th. Argus increased their target price on shares of Charles Schwab from $108.00 to $114.00 and gave the stock a "buy" rating in a research report on Thursday, July 23rd. Truist Financial set a $115.00 target price on shares of Charles Schwab in a research report on Friday, October 16th. Finally, Keefe, Bruyette & Woods reiterated an "outperform" rating and issued a $111.00 price target (up from $109.00) on shares of Charles Schwab in a research note on Friday, October 16th. Eighteen investment analysts have rated the stock with a Buy rating, five have issued a Hold rating and one has assigned a Sell rating to the company. According to MarketBeat, the stock presently has an average rating of "Moderate Buy" and a consensus target price of $120.18.

Charles Schwab Price Performance

Charles Schwab stock opened at $90.56 on Monday. Charles Schwab has a 12 month low of $83.96 and a 12 month high of $114.53. The stock's 50 day moving average is $102.66 and its 200-day moving average is $98.09. The company has a current ratio of 0.64, a quick ratio of 0.64 and a debt-to-equity ratio of 0.52. The company has a market capitalization of $156.61 billion, a price-to-earnings ratio of 15.45, a PEG ratio of 0.81 and a beta of 0.79.

Charles Schwab (NYSE:SCHW - Get Free Report) last released its quarterly earnings results on Thursday, October 15th. The financial services provider reported $1.69 earnings per share for the quarter, beating the consensus estimate of $1.66 by $0.03. Charles Schwab had a net margin of 39.33% and a return on equity of 25.79%. The firm had revenue of $7.17 billion for the quarter, compared to analysts' expectations of $7.18 billion. During the same period in the prior year, the firm earned $1.31 EPS. The business's revenue was up 16.9% on a year-over-year basis.

Charles Schwab Dividend Announcement

The company also recently announced a quarterly dividend, which will be paid on Friday, November 27th. Stockholders of record on Friday, November 13th will be given a $0.32 dividend. The ex-dividend date is Friday, November 13th. This represents a $1.28 annualized dividend and a dividend yield of 1.4%. Charles Schwab's payout ratio is presently 21.84%.

Insider Buying and Selling

In other news, insider Nigel Murtagh sold 24,778 shares of the company's stock in a transaction that occurred on Monday, August 10th. The shares were sold at an average price of $109.01, for a total transaction of $2,701,049.78. Following the completion of the sale, the insider owned 57,972 shares of the company's stock, valued at approximately $6,319,527.72. This represents a 29.94% decrease in their position. The sale was disclosed in a legal filing with the SEC, which is accessible through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Paula Sneed sold 5,263 shares of the company's stock in a transaction that occurred on Friday, August 7th. The stock was sold at an average price of $107.15, for a total transaction of $563,930.45. Following the sale, the director directly owned 91,711 shares of the company's stock, valued at approximately $9,826,833.65. This trade represents a 5.43% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. In the last ninety days, insiders sold 407,142 shares of company stock worth $44,787,802. 6.30% of the stock is owned by company insiders.

Institutional Inflows and Outflows

Several institutional investors have recently added to or reduced their stakes in SCHW. USS Investment Management Ltd lifted its holdings in shares of Charles Schwab by 4.6% in the first quarter. USS Investment Management Ltd now owns 288,035 shares of the financial services provider's stock worth $27,068,000 after acquiring an additional 12,789 shares during the last quarter. Whittier Trust Co. boosted its stake in shares of Charles Schwab by 3.9% in the 1st quarter. Whittier Trust Co. now owns 384,881 shares of the financial services provider's stock valued at $35,790,000 after purchasing an additional 14,538 shares in the last quarter. Financial Advisory Partners LLC bought a new stake in shares of Charles Schwab during the 1st quarter valued at approximately $3,199,000. First Citizens Bank & Trust Co. grew its holdings in shares of Charles Schwab by 102.3% during the 3rd quarter. First Citizens Bank & Trust Co. now owns 33,750 shares of the financial services provider's stock valued at $3,299,000 after purchasing an additional 17,068 shares during the last quarter. Finally, Patriot Financial Group Insurance Agency LLC increased its position in Charles Schwab by 112.0% during the 1st quarter. Patriot Financial Group Insurance Agency LLC now owns 89,498 shares of the financial services provider's stock worth $8,411,000 after purchasing an additional 47,281 shares in the last quarter. 84.38% of the stock is currently owned by institutional investors and hedge funds.

Key Charles Schwab News

Here are the key news stories impacting Charles Schwab this week:

• Positive Sentiment: Schwab may benefit if short-term interest rates remain elevated. Higher yields can increase the income the cash-rich brokerage earns on client balances, potentially supporting net interest revenue and profitability. Why Charles Schwab Stock Could Benefit If Short Term Rates Stay Higher
• Positive Sentiment: The board declared a regular quarterly common-stock dividend of $0.32 per share, equivalent to $1.28 annually and a stated yield of approximately 1.4%. The dividend is payable November 27 to shareholders of record November 13. Schwab Declares Quarterly Common Stock Dividend and Declares Preferred Stock Dividends
• Positive Sentiment: Opening two Portland branches could expand Schwab’s local presence and support client acquisition, although the financial impact is likely modest initially. Schwab opens two new Portland branches to expand local access

About Charles Schwab

The Charles Schwab Corporation NYSE: SCHW is a financial services company that provides investment, wealth management, banking and related services to individual investors, financial professionals and institutional clients. Through its brokerage business, Schwab offers trading and custody services for stocks, exchange-traded funds, mutual funds, options, fixed-income securities and other investments, along with retirement accounts and investment research tools.

The company also provides advisory and wealth management services, including managed portfolios, financial planning and support for registered investment advisors.

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