Fifth Third Bancorp Grows Stake in The Charles Schwab Corporation $SCHW

Key Points

• Fifth Third Bancorp has increased its stake in Charles Schwab by 11.0% to a total of 158,051 shares, valued at approximately $14.4 million.
• Charles Schwab reported a quarterly EPS of $1.14, surpassing estimates and marking a 24.8% revenue growth compared to the previous year.
• The company authorized a $20 billion share buyback program that allows it to repurchase up to 11.6% of its shares, indicating confidence in its stock value.

Fifth Third Bancorp increased its holdings in The Charles Schwab Corporation (NYSE:SCHW - Free Report) by 11.0% during the second quarter, according to the company in its most recent 13F filing with the Securities and Exchange Commission. The institutional investor owned 158,051 shares of the financial services provider's stock after purchasing an additional 15,690 shares during the period. Fifth Third Bancorp's holdings in Charles Schwab were worth $14,421,000 as of its most recent SEC filing.

A number of other institutional investors have also added to or reduced their stakes in SCHW. Vanguard Group Inc. increased its holdings in Charles Schwab by 15.4% in the 1st quarter. Vanguard Group Inc. now owns 148,395,252 shares of the financial services provider's stock valued at $11,616,380,000 after acquiring an additional 19,817,022 shares during the last quarter. Price T Rowe Associates Inc. MD grew its position in shares of Charles Schwab by 12.3% during the first quarter. Price T Rowe Associates Inc. MD now owns 82,048,984 shares of the financial services provider's stock valued at $6,422,795,000 after purchasing an additional 8,954,248 shares in the last quarter. Northern Trust Corp increased its holdings in shares of Charles Schwab by 10.8% in the first quarter. Northern Trust Corp now owns 17,440,301 shares of the financial services provider's stock worth $1,365,227,000 after purchasing an additional 1,700,384 shares during the last quarter. Alliancebernstein L.P. lifted its position in shares of Charles Schwab by 16.0% in the first quarter. Alliancebernstein L.P. now owns 17,115,759 shares of the financial services provider's stock worth $1,339,822,000 after buying an additional 2,355,309 shares in the last quarter. Finally, Invesco Ltd. boosted its stake in Charles Schwab by 5.0% during the first quarter. Invesco Ltd. now owns 15,586,450 shares of the financial services provider's stock valued at $1,220,107,000 after buying an additional 743,906 shares during the last quarter. 84.38% of the stock is owned by hedge funds and other institutional investors.

Charles Schwab Price Performance

Charles Schwab stock opened at $92.32 on Thursday. The Charles Schwab Corporation has a 12-month low of $62.41 and a 12-month high of $99.59. The company has a current ratio of 0.55, a quick ratio of 0.55 and a debt-to-equity ratio of 0.47. The firm has a 50-day moving average price of $95.52 and a 200-day moving average price of $87.63. The firm has a market capitalization of $167.57 billion, a PE ratio of 24.82, a price-to-earnings-growth ratio of 0.93 and a beta of 0.96.

Charles Schwab (NYSE:SCHW - Get Free Report) last issued its quarterly earnings results on Friday, July 18th. The financial services provider reported $1.14 EPS for the quarter, beating the consensus estimate of $1.10 by $0.04. The company had revenue of $5.85 billion for the quarter, compared to the consensus estimate of $5.64 billion. Charles Schwab had a net margin of 33.68% and a return on equity of 19.30%. The firm's revenue was up 24.8% compared to the same quarter last year. During the same period in the prior year, the firm posted $0.73 EPS. As a group, equities research analysts forecast that The Charles Schwab Corporation will post 4.22 EPS for the current year.

Charles Schwab declared that its Board of Directors has approved a share buyback program on Thursday, July 24th that authorizes the company to buyback $20.00 billion in outstanding shares. This buyback authorization authorizes the financial services provider to repurchase up to 11.6% of its shares through open market purchases. Shares buyback programs are usually an indication that the company's board believes its stock is undervalued.

Charles Schwab Announces Dividend

The firm also recently disclosed a quarterly dividend, which was paid on Friday, August 22nd. Investors of record on Friday, August 8th were issued a dividend of $0.27 per share. The ex-dividend date was Friday, August 8th. This represents a $1.08 dividend on an annualized basis and a yield of 1.2%. Charles Schwab's payout ratio is presently 29.03%.

Insider Buying and Selling

In other news, insider Jonathan S. Beatty sold 6,144 shares of Charles Schwab stock in a transaction on Thursday, August 28th. The stock was sold at an average price of $96.81, for a total transaction of $594,800.64. Following the completion of the sale, the insider directly owned 11,923 shares in the company, valued at approximately $1,154,265.63. This trade represents a 34.01% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through this link. Also, insider Nigel J. Murtagh sold 24,096 shares of the business's stock in a transaction on Tuesday, July 29th. The shares were sold at an average price of $97.91, for a total transaction of $2,359,239.36. Following the sale, the insider directly owned 58,999 shares of the company's stock, valued at $5,776,592.09. This represents a 29.00% decrease in their ownership of the stock. The disclosure for this sale can be found here. Insiders have sold a total of 267,213 shares of company stock worth $26,232,180 over the last ninety days. Corporate insiders own 6.30% of the company's stock.

Analyst Ratings Changes

A number of research firms have issued reports on SCHW. Barclays lifted their price objective on Charles Schwab from $106.00 to $113.00 and gave the stock an "overweight" rating in a research note on Friday, July 18th. Bank of America boosted their price target on shares of Charles Schwab from $83.00 to $84.00 and gave the stock an "underperform" rating in a research report on Monday, July 21st. Morgan Stanley increased their price objective on shares of Charles Schwab from $117.00 to $131.00 and gave the company an "overweight" rating in a research report on Tuesday, July 29th. William Blair downgraded shares of Charles Schwab from a "strong-buy" rating to a "hold" rating in a report on Thursday, July 3rd. Finally, Raymond James Financial reaffirmed an "outperform" rating and issued a $99.00 price target on shares of Charles Schwab in a report on Friday, July 18th. Sixteen investment analysts have rated the stock with a Buy rating, four have assigned a Hold rating and two have given a Sell rating to the company's stock. According to MarketBeat, Charles Schwab currently has a consensus rating of "Moderate Buy" and a consensus target price of $100.00.

About Charles Schwab

The Charles Schwab Corporation, together with its subsidiaries, operates as a savings and loan holding company that provides wealth management, securities brokerage, banking, asset management, custody, and financial advisory services in the United States and internationally. The company operates in two segments, Investor Services and Advisor Services.

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