Charles Schwab Shares Surge 7.2% Following Strong Earnings Report

The shares of Charles Schwab Corporation (NYSE:SCHW) experienced a significant increase of 7.2% during midday trading on Tuesday after the company reported earnings that exceeded expectations. The stock price reached a high of $82.20 before settling at $81.92. In total, approximately 3,708,003 shares changed hands, which is a notable decline of 54% from its average daily trading volume of 8,066,129 shares. The previous closing price was $76.41.

Charles Schwab announced earnings of $1.01 per share for the quarter, surpassing analysts' forecast of $0.90 by $0.11. The company's revenue for the quarter was reported at $5.33 billion, exceeding the predicted $5.19 billion. This represents a growth of 19.5% compared to the same quarter of the previous year, during which the company recorded earnings of $0.68 per share. Additionally, Charles Schwab reported a return on equity of 16.92% and a net margin of 27.47%.

Dividend Announcement from Charles Schwab

The company also declared a quarterly dividend recently, which was distributed on November 22. Shareholders who were on record as of November 8 received a dividend of $0.25 per share, resulting in an annualized dividend of $1.00 and a yield of 1.23%. The ex-dividend date was also noted as November 8, with a current payout ratio of 39.06%.

Analysts Adjust Price Targets

Several research firms have revised their price targets for Charles Schwab. Piper Sandler increased their target from $65.00 to $70.00, maintaining a "neutral" rating. Deutsche Bank raised their target from $77.00 to $80.00, giving the stock a "buy" rating. Conversely, Raymond James reduced their target from $76.00 to $73.00. Additionally, JPMorgan Chase lifted their target from $87.00 to $93.00 while maintaining an "overweight" rating. Cowen also adjusted their target from $69.00 to $75.00, giving a "hold" rating. MarketBeat indicates that two analysts have rated the stock as a sell, eight as a hold, seven as a buy, and one as a strong buy, leading to a consensus rating of "Hold" with an average price target of $81.41.

Insider Trading Insights

In related news, insider Jonathan S. Beatty sold 2,300 shares at an average price of $82.01, totaling $188,623. Post-sale, Beatty now owns 18,069 shares worth approximately $1.48 million, reflecting a decrease of 11.29% in their holdings. Furthermore, Director Christopher V. Dodds sold 9,284 shares for approximately $755,996, reducing their ownership by 2.05% to 442,807 shares valued at about $36.06 million. In the past 90 days, insiders sold a total of 26,823 shares valued at $2.17 million, indicating that insiders currently hold 6.60% of the company's stock.

Institutional Investor Activity

Institutional investors have been active in buying and selling shares of Charles Schwab. For instance, Capital Performance Advisors LLP acquired a new position in the company worth $25,000, while Washington Trust Advisors raised their stake by 62.6%, now owning 387 shares valued at the same amount after purchasing an additional 149 shares. Prospera Private Wealth LLC and Planning Capital Management Corp also made new investments worth approximately $31,000 and $33,000, respectively. Overall, 84.38% of Charles Schwab's shares are owned by institutional investors.

Stock Performance and Financial Ratios

Currently, Charles Schwab's stock is trading above its 50-day moving average of $77.65 and its 200-day moving average of $70.62. The company has a debt-to-equity ratio of 0.59, with current and quick ratios both at 0.47. With a market cap of $144.15 billion, the stock has a P/E ratio of 31.88, a price-to-earnings-growth ratio of 1.41, and a beta of 0.99.

Overview of Charles Schwab Corporation

Charles Schwab Corporation, along with its subsidiaries, acts as a savings and loan holding company, providing a wide range of services including wealth management, securities brokerage, banking, and financial advisory services both in the U.S. and internationally. The firm operates through two primary segments: Investor Services and Advisor Services.

Schwab, Earnings, Investors