Graham Capital Management L.P. Cuts Stock Position in The Charles Schwab Corporation $SCHW

Key Points

• Graham Capital Management L.P. significantly reduced its stake in The Charles Schwab Corporation by 83.3% in the first quarter, holding only 18,711 shares post-sale.
• Vanguard Group Inc. and other institutional investors increased their holdings, with Vanguard growing its stake by 15.4%, now owning 148 million shares valued at approximately $11.6 billion.
• Charles Schwab has announced a $20 billion stock repurchase plan, reflecting the board's belief that the stock is undervalued.

Graham Capital Management L.P. cut its holdings in The Charles Schwab Corporation (NYSE:SCHW - Free Report) by 83.3% in the first quarter, according to the company in its most recent disclosure with the SEC. The institutional investor owned 18,711 shares of the financial services provider's stock after selling 93,665 shares during the quarter. Graham Capital Management L.P.'s holdings in Charles Schwab were worth $1,465,000 at the end of the most recent quarter.

A number of other institutional investors and hedge funds have also recently modified their holdings of the business. Vanguard Group Inc. grew its holdings in shares of Charles Schwab by 15.4% in the first quarter. Vanguard Group Inc. now owns 148,395,252 shares of the financial services provider's stock valued at $11,616,380,000 after purchasing an additional 19,817,022 shares in the last quarter. Price T Rowe Associates Inc. MD grew its holdings in shares of Charles Schwab by 12.3% in 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 grew 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 valued at $1,365,227,000 after purchasing an additional 1,700,384 shares in the last quarter. Invesco Ltd. grew its holdings in shares of Charles Schwab by 5.0% in 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 purchasing an additional 743,906 shares in the last quarter. Finally, Wellington Management Group LLP grew its holdings in shares of Charles Schwab by 595.7% in the first quarter. Wellington Management Group LLP now owns 15,488,777 shares of the financial services provider's stock valued at $1,212,461,000 after purchasing an additional 13,262,309 shares in the last quarter. 84.38% of the stock is owned by hedge funds and other institutional investors.

Charles Schwab Stock Up 0.1%

NYSE:SCHW opened at $95.97 on Wednesday. The Charles Schwab Corporation has a twelve month low of $61.16 and a twelve month high of $99.59. The company has a market cap of $174.21 billion, a price-to-earnings ratio of 25.80, a price-to-earnings-growth ratio of 0.94 and a beta of 0.96. The stock has a fifty day simple moving average of $94.87 and a 200-day simple moving average of $86.06. The company has a current ratio of 0.55, a quick ratio of 0.55 and a debt-to-equity ratio of 0.47.

Charles Schwab (NYSE:SCHW - Get Free Report) last released its earnings results on Friday, July 18th. The financial services provider reported $1.14 earnings per share for the quarter, topping the consensus estimate of $1.10 by $0.04. Charles Schwab had a return on equity of 19.30% and a net margin of 33.68%.The business had revenue of $5.85 billion during the quarter, compared to the consensus estimate of $5.64 billion. During the same period last year, the company earned $0.73 earnings per share. The business's revenue for the quarter was up 24.8% compared to the same quarter last year. Analysts anticipate that The Charles Schwab Corporation will post 4.22 EPS for the current year.

Charles Schwab Dividend Announcement

The company also recently disclosed a quarterly dividend, which was paid on Friday, August 22nd. Investors of record on Friday, August 8th were issued a $0.27 dividend. This represents a $1.08 annualized dividend and a dividend yield of 1.1%. The ex-dividend date was Friday, August 8th. Charles Schwab's payout ratio is presently 29.03%.

Charles Schwab announced that its board has authorized a stock repurchase plan on Thursday, July 24th that permits the company to repurchase $20.00 billion in shares. This repurchase authorization permits the financial services provider to repurchase up to 11.6% of its stock through open market purchases. Stock repurchase plans are usually a sign that the company's board of directors believes its stock is undervalued.

Wall Street Analysts Forecast Growth

Several research analysts have commented on the stock. Truist Financial lifted their price objective on shares of Charles Schwab from $107.00 to $112.00 and gave the stock a "buy" rating in a research note on Friday, August 15th. Morgan Stanley lifted their price objective on shares of Charles Schwab from $117.00 to $131.00 and gave the stock an "overweight" rating in a research note on Tuesday, July 29th. Raymond James Financial reaffirmed an "outperform" rating and set a $99.00 price objective on shares of Charles Schwab in a research note on Friday, July 18th. William Blair lowered shares of Charles Schwab from a "strong-buy" rating to a "hold" rating in a research note on Thursday, July 3rd. Finally, JMP Securities lifted their price objective on shares of Charles Schwab from $106.00 to $110.00 and gave the stock a "market outperform" rating in a research note on Monday, July 21st. Sixteen analysts have rated the stock with a Buy rating, three have assigned a Hold rating and two have given a Sell rating to the company's stock. Based on data from MarketBeat.com, Charles Schwab currently has a consensus rating of "Moderate Buy" and an average target price of $99.60.

Insider Transactions at Charles Schwab

In related news, insider Nigel J. Murtagh sold 24,096 shares of Charles Schwab stock in a transaction dated Tuesday, July 29th. The stock was sold at an average price of $97.91, for a total value of $2,359,239.36. Following the completion of the sale, the insider directly owned 58,999 shares in the company, valued at $5,776,592.09. The trade was a 29.00% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is available through the SEC website. Also, General Counsel Peter J. Morgan III sold 50,016 shares of Charles Schwab stock in a transaction dated Wednesday, August 27th. The shares were sold at an average price of $97.00, for a total value of $4,851,552.00. The disclosure for this sale can be found here. Insiders sold a total of 295,009 shares of company stock valued at $28,717,464 over the last three months. 6.30% of the stock is currently owned by corporate insiders.

Charles Schwab Profile

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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