Primecap Management Co. CA Acquires 9,749,728 Shares of The Charles Schwab Corporation (NYSE:SCHW)

Key Points

• Primecap Management Co. CA increased its stake in The Charles Schwab Corporation by 229.3%, acquiring an additional 9,749,728 shares, bringing their total ownership to approximately 14 million shares valued at over $1 billion.
• The company is planning a $20 billion stock buyback program, indicating confidence in the company's valuation, along with a recently declared quarterly dividend of $0.27 per share.
• Analysts maintain a consensus rating of "Moderate Buy" on the stock, with target price estimates ranging from $82 to $113, highlighting expected growth in the company's performance.

Primecap Management Co. CA boosted its position in The Charles Schwab Corporation (NYSE:SCHW - Free Report) by 229.3% in the 1st quarter, according to its most recent filing with the Securities and Exchange Commission (SEC). The firm owned 14,002,078 shares of the financial services provider's stock after purchasing an additional 9,749,728 shares during the quarter. Primecap Management Co. CA owned about 0.77% of Charles Schwab worth $1,096,083,000 at the end of the most recent reporting period.

Several other institutional investors have also added to or reduced their stakes in SCHW. Brighton Jones LLC boosted its stake in Charles Schwab by 380.5% in the 4th quarter. Brighton Jones LLC now owns 24,240 shares of the financial services provider's stock valued at $1,794,000 after purchasing an additional 19,195 shares during the period. Aster Capital Management DIFC Ltd boosted its stake in Charles Schwab by 213.7% in the 4th quarter. Aster Capital Management DIFC Ltd now owns 1,606 shares of the financial services provider's stock valued at $119,000 after purchasing an additional 1,094 shares during the period. FMR LLC boosted its stake in Charles Schwab by 69.4% in the 4th quarter. FMR LLC now owns 9,700,013 shares of the financial services provider's stock valued at $717,898,000 after purchasing an additional 3,974,940 shares during the period. Shelton Capital Management boosted its stake in Charles Schwab by 17.5% in the 4th quarter. Shelton Capital Management now owns 90,959 shares of the financial services provider's stock valued at $6,732,000 after purchasing an additional 13,542 shares during the period. Finally, FIL Ltd boosted its stake in Charles Schwab by 159.0% in the 4th quarter. FIL Ltd now owns 923,000 shares of the financial services provider's stock valued at $68,311,000 after purchasing an additional 566,591 shares during the period. 84.38% of the stock is currently owned by institutional investors.

Wall Street Analyst Weigh In

A number of research firms have recently weighed in on SCHW. TD Securities upped their target price on Charles Schwab from $95.00 to $113.00 and gave the company a "buy" rating in a research report on Tuesday, May 20th. UBS Group upped their target price on Charles Schwab from $95.00 to $96.00 and gave the company a "buy" rating in a research report on Tuesday, April 22nd. JMP Securities upped their target price on Charles Schwab from $106.00 to $110.00 and gave the company a "market outperform" rating in a research report on Monday, July 21st. Wells Fargo & Company set a $102.00 target price on Charles Schwab and gave the company an "overweight" rating in a research report on Friday, July 18th. Finally, Redburn Atlantic upgraded Charles Schwab from a "sell" rating to a "neutral" rating and upped their target price for the company from $65.00 to $82.00 in a research report on Monday, June 9th. Two equities research analysts have rated the stock with a sell rating, four have issued a hold rating and sixteen have issued a buy rating to the stock. According to data from MarketBeat.com, the company has a consensus rating of "Moderate Buy" and a consensus price target of $99.35.

Insider Activity

In other news, insider Paul V. Woolway sold 3,290 shares of the firm's stock in a transaction on Friday, August 1st. The stock was sold at an average price of $96.06, for a total transaction of $316,037.40. Following the completion of the sale, the insider directly owned 41,188 shares of the company's stock, valued at $3,956,519.28. This trade represents a 7.40% decrease in their position. The sale was disclosed in a document filed with the SEC, which is available through the SEC website. Also, insider Jonathan S. Beatty sold 2,850 shares of the firm's stock in a transaction on Friday, May 30th. The shares were sold at an average price of $87.57, for a total value of $249,574.50. Following the sale, the insider directly owned 15,219 shares of the company's stock, valued at approximately $1,332,727.83. This represents a 15.77% decrease in their ownership of the stock. The disclosure for this sale can be found here. Over the last quarter, insiders sold 308,016 shares of company stock worth $29,341,433. 6.30% of the stock is owned by insiders.

Charles Schwab Stock Down 0.6%

Shares of NYSE:SCHW opened at $96.47 on Wednesday. The business's 50 day simple moving average is $91.64 and its two-hundred day simple moving average is $84.02. The firm has a market cap of $175.28 billion, a P/E ratio of 25.93, a PEG ratio of 0.93 and a beta of 0.96. The company has a debt-to-equity ratio of 0.53, a quick ratio of 0.53 and a current ratio of 0.53. The Charles Schwab Corporation has a 52-week low of $61.16 and a 52-week high of $99.59.

Charles Schwab (NYSE:SCHW - Get Free Report) last posted its earnings results on Friday, July 18th. The financial services provider reported $1.14 earnings per share for the quarter, beating analysts' consensus estimates of $1.10 by $0.04. Charles Schwab had a return on equity of 19.73% and a net margin of 33.68%. The company had revenue of $5.85 billion for the quarter, compared to analyst estimates of $5.64 billion. During the same quarter last year, the company earned $0.73 earnings per share. The company's revenue for the quarter was up 24.8% on a year-over-year basis. As a group, research analysts forecast that The Charles Schwab Corporation will post 4.22 EPS for the current fiscal year.

Charles Schwab Announces Dividend

The firm also recently announced a quarterly dividend, which will be paid on Friday, August 22nd. Stockholders of record on Friday, August 8th will be given a dividend of $0.27 per share. The ex-dividend date of this dividend is Friday, August 8th. This represents a $1.08 annualized dividend and a dividend yield of 1.1%. Charles Schwab's dividend payout ratio (DPR) is currently 29.03%.

Charles Schwab declared that its Board of Directors has authorized a stock buyback plan on Thursday, July 24th that authorizes the company to repurchase $20.00 billion in shares. This repurchase authorization authorizes the financial services provider to repurchase up to 11.6% of its stock through open market purchases. Stock repurchase plans are typically an indication that the company's board believes its shares are undervalued.

Charles Schwab Company 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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