Charles Schwab (NYSE:SCHW) Reaches New 1-Year High Following Analyst Upgrade

On Wednesday, shares of The Charles Schwab Co. (NYSE:SCHW) climbed to a new 52-week high, significantly influenced by an upgrade from Truist Financial, which raised its price target for the stock from $90.00 to $91.00. With this upgrade, Truist Financial has maintained a buy rating for the stock. During the trading session, Charles Schwab reached a peak price of $84.50 before closing at $83.51. The trading volume was notably high, with 59,325,916 shares exchanged, in contrast to the previous day’s closing price of $81.17.

In addition to Truist Financial's upgrade, other analysts have provided insights on Charles Schwab's stock. Citigroup recently adjusted their price target, moving it from $80.00 to $85.00 while assigning a “neutral” rating in a research report dated January 22nd. Meanwhile, the Goldman Sachs Group increased its target price from $67.00 to $74.00, also issuing a “neutral” rating on October 16th. On February 6th, Morgan Stanley raised their price objective from $84.00 to $91.00 and assigned an “equal weight” rating. Barclays adjusted its target price higher from $95.00 to $96.00, rating the stock as “overweight” on January 22nd. Additionally, JPMorgan Chase & Co. upgraded the price target from $87.00 to $93.00, maintaining an “overweight” rating in their report on January 7th. Overall, data from MarketBeat.com indicates that analysts' ratings are diverse, with two analysts issuing sell ratings, seven maintaining hold ratings, and nine promoting buy ratings. The consensus rating for the stock stands at “Hold” with an average price target of $84.56.

Insider Activity

Recent activity by company insiders has also been noteworthy. Director Arun Sarin sold 8,548 shares of Charles Schwab on January 23rd at an average price of $81.82, totaling approximately $699,397.36. Following this transaction, Sarin holds 18,617 shares of the company, which are valued at around $1,523,242.94, reflecting a 31.47% reduction in his holdings. Additionally, Director Christopher V. Dodds sold 9,284 shares on November 18th at an average price of $81.43, amounting to about $755,996.12. After this sale, he possesses 442,807 shares valued at $36,057,774.01, marking a 2.05% decrease in his stake. Over the past three months, insiders have sold a total of 47,514 shares, with insider ownership currently at 6.60%.

Institutional Investment Trends

A number of institutional investors have adjusted their positions in Charles Schwab recently. Washington Trust Advisors Inc. increased their stake by 62.6% in the third quarter, acquiring an additional 149 shares, bringing their total to 387 shares valued at approximately $25,000. Capital Performance Advisors LLP also purchased a new stake valued around $25,000 during the same period. Other institutions such as Prospera Private Wealth LLC and Hazlett Burt & Watson Inc. also made new acquisitions, with stakes valued at about $31,000 and $33,000, respectively. Currently, about 84.38% of Charles Schwab’s stock is owned by institutional investors and hedge funds.

Stock Performance Metrics

As of the latest trading phase, Charles Schwab’s stock has increased by 2.9%. The company maintains a debt-to-equity ratio of 0.59, along with a quick ratio and current ratio of 0.47 each. The average price for the last 50 days stands at $77.99, while the 200-day average price is $71.99. Charles Schwab boasts a market capitalization of $148.61 billion, a price-to-earnings ratio of 27.93, a PEG ratio of 1.02, and a beta of 0.99.

In terms of earnings, Charles Schwab recently released its quarterly results on January 21st, reporting an earnings per share (EPS) of $1.01, surpassing analysts’ expectations by $0.11, with total revenue hitting $5.33 billion, exceeding projections of $5.19 billion. This marked a 19.5% increase in revenue compared to the same quarter last year. Analysts project that the company will achieve an EPS of 4.18 for the current year.

Dividend Announcement

The company also announced a quarterly dividend to be distributed on February 28th, with investors of record on February 14th receiving $0.27 per share. This represents an increase from the prior dividend of $0.25. The ex-dividend date is also set for February 14th, indicating an annualized dividend of $1.08, which translates to a dividend yield of 1.29%. Currently, Charles Schwab maintains a dividend payout ratio of 33.44%.

Company Overview

The Charles Schwab Corporation operates as a holding company for savings and loans, providing a variety of financial services including wealth management, securities brokerage, banking, asset management, custody, and financial advisory services both in the U.S. and internationally. The firm consists of two main operational segments: Investor Services and Advisor Services.

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