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HYPOTHETICAL PERFORMANCE RESULTS: The "timing scores" and "regime signals" displayed are based on quantitative models. Hypothetical or simulated performance results have certain inherent limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not actually been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity.
RISK OF LOSS: Trading in financial markets involves a high degree of risk and may result in the loss of your entire investment. Data provided by third-party sources (Intrinio, Snowflake) is believed to be reliable but is not guaranteed for accuracy or completeness. Past performance is not indicative of future results.
Relative valuation derived from Financials sector median benchmarks. Model weights: EV/EBITDA (40%), P/B (35%), P/S (25%). Multiples adjusted for extreme outliers and non-recurring volatility.
Auditing capital efficiency...
Quality Profile Audit
Score: 65.4GRADE B
Composite assessment of profitability, capital efficiency, and financial strength. Top-tier entities demonstrate sustainable cash flow generation.
Return on Equity
Profit generated per dollar of shareholder equity
15.8%
Sector: 8.5%
Dividend Analysis audit
GROWTH
1.11%
Trailing Yield
$1.11
Per $100 Invested
Modest dividend — capital prioritized for reinvestment.
Est. Payout Ratio
23%SAFE
Analyst Projections
Analyst Consensus
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Based on our 6-factor quantitative model, SCHWAB CHARLES CORP (SCHW) receives a "Hold" rating with a composite score of 56.3/100, ranked #627 out of 4446 stocks. Key factor scores: Quality 65/100, Value 65/100, Momentum 47/100. This is quantitative analysis only — not investment advice.
SCHWAB CHARLES CORP (SCHW) Stock Analysis — April 2026 Rating, Price, and Forecast
Company Overview — What Does SCHWAB CHARLES CORP Do?
The Charles Schwab Corporation, together with its subsidiaries, provides wealth management, securities brokerage, banking, asset management, custody, and financial advisory services. The company operates in two segments, Investor Services and Advisor Services. The Investor Services segment provides retail brokerage, investment advisory, banking and trust, retirement plan, and other corporate brokerage services; equity compensation plan sponsors full-service recordkeeping for stock plans, stock options, restricted stock, performance shares, and stock appreciation rights; and retail investor and mutual fund clearing services, as well as compliance solutions. The Advisor Services segment offers custodial, trading, banking, and support services; and retirement business and corporate brokerage retirement services. This segment provides brokerage accounts with equity and fixed income, margin lending, options, and futures and forex trading; cash management capabilities comprising third-party certificates of deposit; third-party and proprietary mutual funds; plus mutual fund trading and clearing services; and exchange-traded funds (ETFs), including proprietary and third-party ETFs. It also offers advice solutions, such as managed portfolios of proprietary and third-party mutual funds and ETFs, separately managed accounts, customized personal advice for tailored portfolios, and specialized planning and portfolio management. In addition, this segment provides banking products and services, including checking and savings accounts, first lien residential real estate mortgage loans, home equity lines of credit, and pledged asset lines; and trust services comprising trust custody services, personal trust reporting services, and administrative trustee services. As of December 31, 2021, the Company had approximately 400 domestic branch offices in 48 states and the District of Columbia, as well as locations in Puerto Rico, the United Kingdom, Hong Kong, and Singapore. The Charles Schwab Corporation was incorporated in 1971 and is headquartered in Westlake, Texas. SCHWAB CHARLES CORP (SCHW) is classified as a large-cap stock in the Financials sector, specifically within the Trading industry. The company is led by CEO Walter W. Bettinger and employs approximately 35,300 people, headquartered in SAN FRANCISCO, Texas. With a market capitalization of $161.8B, SCHW is one of the prominent companies in the Financials sector.
SCHWAB CHARLES CORP (SCHW) Stock Rating — Hold (April 2026)
As of April 2026, SCHWAB CHARLES CORP receives a Hold rating with a composite score of 56.3/100 and 3 out of 5 stars from the Blank Capital Research quantitative model.SCHW ranks #627 out of 4,446 stocks in our coverage universe. Within the Financials sector, SCHWAB CHARLES CORP ranks #188 of 891 stocks, placing it in the top quartile of its Financials peers. The rating is generated by a multi-factor model that weighs quality (30%), momentum (25%), value (15%), investment (10%), stability (10%), and short interest (10%).
SCHW Stock Price and 52-Week Range
SCHWAB CHARLES CORP (SCHW) currently trades at $94.87. The stock lost $2.40 (2.5%) in the most recent trading session. The 52-week high for SCHW is $107.50, which means the stock is currently trading -11.7% from its annual peak. The 52-week low is $65.88, putting the stock 44.0% above its annual trough. Recent trading volume was 9.3M shares, reflecting moderate market activity.
Is SCHW Overvalued or Undervalued? — Valuation Analysis
SCHWAB CHARLES CORP (SCHW) carries a value factor score of 65/100 in the Blank Capital model, indicating fair valuation relative to historical norms. The trailing price-to-earnings ratio is 20.80x, compared to the Financials sector average of 14.88x — a premium of 40%. The price-to-book ratio stands at 3.28x, versus the sector average of 1.22x. The price-to-sales ratio is 7.23x, compared to 0.90x for the average Financials stock. On an enterprise value basis, SCHW trades at 16.03x EV/EBITDA, versus 3.26x for the sector.
Overall, SCHW's valuation appears roughly in line with sector benchmarks, suggesting the market is pricing the stock fairly given its current fundamentals and growth trajectory. Neither deep value nor significantly overpriced, the stock occupies a middle ground on valuation.
SCHWAB CHARLES CORP Profitability — ROE, Margins, and Quality Score
SCHWAB CHARLES CORP (SCHW) earns a quality factor score of 65/100, indicating solid business quality with consistent operational execution. The return on equity (ROE) is 15.8%, compared to the Financials sector average of 8.5%, which is within a healthy range. Return on assets (ROA) comes in at 1.6% versus the sector average of 1.2%.
On a margin basis, SCHWAB CHARLES CORP reports gross margins of 0.0%. The operating margin is 44.8% (sector: 21.8%). Net profit margin stands at 34.5%, versus 17.7% for the average Financials stock. Revenue growth is running at 30.8% on a trailing basis, compared to 9.4% for the sector. The overall profitability profile is adequate, though there may be room for margin expansion.
SCHW Debt, Balance Sheet, and Financial Health
SCHWAB CHARLES CORP has a debt-to-equity ratio of 893.0%, compared to the Financials sector average of 121.0%. This elevated leverage warrants close monitoring, as it increases the company's sensitivity to rising interest rates and economic downturns. The current ratio is 1.11x, suggesting adequate working capital coverage. Total debt on the balance sheet is $165.39B. Cash and equivalents stand at $30.57B.
SCHW has a beta of 0.80, meaning it is less volatile than the S&P 500, making it a relatively defensive holding. The stability factor score for SCHWAB CHARLES CORP is 86/100, indicating low-volatility characteristics and consistent price behavior that appeals to risk-averse investors.
SCHWAB CHARLES CORP Revenue and Earnings History — Quarterly Trend
In TTM 2026, SCHWAB CHARLES CORP reported revenue of $22.43B and earnings per share (EPS) of $4.67. Net income for the quarter was $7.80B. Gross margin was 0.0%. Operating income came in at $10.12B.
In FY 2025, SCHWAB CHARLES CORP reported revenue of $23.92B and earnings per share (EPS) of $4.67. Net income for the quarter was $8.85B. Revenue grew 22.0% year-over-year compared to FY 2024. Operating income came in at $11.46B.
In Q3 2025, SCHWAB CHARLES CORP reported revenue of $6.13B and earnings per share (EPS) of $1.26. Net income for the quarter was $2.36B. Revenue grew 26.6% year-over-year compared to Q3 2024. Operating income came in at $3.02B.
In Q2 2025, SCHWAB CHARLES CORP reported revenue of $5.85B and earnings per share (EPS) of $1.09. Net income for the quarter was $2.13B. Revenue grew 24.8% year-over-year compared to Q2 2024. Operating income came in at $2.80B.
Over the past 8 quarters, SCHWAB CHARLES CORP has demonstrated a growth trajectory, with revenue expanding from $4.69B to $22.43B. Investors analyzing SCHW stock should weigh these quarterly trends alongside the valuation and quality metrics discussed above.
SCHW Dividend Yield and Income Analysis
SCHWAB CHARLES CORP (SCHW) currently pays a dividend yield of 1.1%. At this yield, a $10,000 investment in SCHW stock would generate approximately $$111.00 in annual dividend income. This compares to the Financials sector average dividend yield of 2.5%, meaning SCHW yields less than the typical sector peer. With a net margin of 34.5%, the dividend appears well-covered by earnings, suggesting sustainable payouts going forward.
SCHW Momentum and Technical Analysis Profile
SCHWAB CHARLES CORP (SCHW) has a momentum factor score of 47/100, reflecting neutral trend characteristics. The stock is neither significantly outperforming nor underperforming the broader market on a momentum basis. The investment factor score is 24/100, which measures capital allocation efficiency and asset growth patterns. The short interest score of 40/100 reflects moderate short selling activity.
SCHW vs Competitors — Financials Sector Ranking and Peer Comparison
Comparing SCHW against the S&P 500 benchmark is also instructive for understanding relative performance. Investors can view the full SCHW vs S&P 500 (SPY) comparison to assess how SCHWAB CHARLES CORP stacks up against the broader market across all factor dimensions.
SCHW Next Earnings Date
No upcoming earnings date has been announced for SCHWAB CHARLES CORP (SCHW) at this time. Check the earnings calendar for the latest scheduling updates across all stocks in our coverage universe.
Should You Buy SCHW? — Investment Thesis Summary
SCHWAB CHARLES CORP presents a balanced picture with arguments on both sides. The quality score of 65/100 indicates above-average profitability and business fundamentals. The value score of 65/100 suggests attractive pricing relative to fundamentals. Low volatility (stability score 86/100) reduces downside risk.
In summary, SCHWAB CHARLES CORP (SCHW) earns a Hold rating with a composite score of 56.3/100 as of April 2026. The rating is derived from the Blank Capital Research methodology, which combines six factor dimensions into a single quantitative ranking. Investors should consider these quantitative signals alongside their own fundamental research, risk tolerance, and investment time horizon before making buy or sell decisions on SCHW stock.
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Institutional Research Dossier
SCHWAB CHARLES CORP (SCHW) Deep Dive Analysis
Published on March 24, 2026
Action RatingHold
Sections
Executive Summary
We maintain our Hold rating on Charles Schwab (SCHW). While the company exhibits strong profitability and a solid competitive position within the brokerage industry, its current valuation appears stretched relative to its growth prospects and elevated debt levels. The integration of TD Ameritrade continues to present both opportunities and challenges, and the company's reliance on interest rate spreads exposes it to macroeconomic headwinds.
Schwab's impressive scale and brand recognition provide a durable advantage, but the increasing competition from fintech disruptors and the potential for regulatory changes warrant caution. The company's high debt-to-equity ratio raises concerns about financial flexibility in a rising interest rate environment. Therefore, we believe a Hold rating is warranted, reflecting a balanced view of Schwab's strengths and weaknesses.
Business Strategy & Overview
Charles Schwab operates as a diversified financial services company, primarily serving retail investors and independent investment advisors. Its core business revolves around providing brokerage, wealth management, and banking services. The company generates revenue through a combination of net interest revenue, asset management and administration fees, trading revenue, and other fees. Schwab's strategic focus is on attracting and retaining client assets, expanding its service offerings, and leveraging technology to enhance the client experience.
The acquisition of TD Ameritrade significantly expanded Schwab's scale and market share, creating a dominant player in the brokerage industry. The integration process, however, is complex and requires careful management to realize the anticipated synergies and avoid disruptions to client service. Schwab is actively investing in technology to improve its trading platforms, mobile apps, and advisory tools, aiming to cater to the evolving needs of its diverse client base.
Schwab's business model is heavily influenced by macroeconomic factors, particularly interest rates. The company's net interest revenue is sensitive to changes in interest rate spreads, which can impact its profitability. In a low-interest-rate environment, Schwab's net interest margin may be compressed, while rising rates can provide a boost to earnings. The company actively manages its balance sheet to mitigate interest rate risk, but it remains a key driver of its financial performance.
The company operates in two segments, Investor Services and Advisor Services. The Investor Services segment focuses on retail investors, offering brokerage, investment advisory, and banking services. The Advisor Services segment caters to independent investment advisors, providing custodial, trading, and support services. This diversified approach allows Schwab to capture a broader range of clients and revenue streams. Schwab also offers a range of proprietary and third-party investment products, including mutual funds and ETFs, which generate asset management and administration fees.
Execution Benchmarks audit
Revenue Growth
YOY expansion rate
30.8%
Sector: 9.4%
+228% VS SCTR
Economic Moat Analysis
Charles Schwab possesses a Narrow economic moat, primarily derived from its strong brand reputation, significant scale, and established network of independent investment advisors. The company's brand is synonymous with low-cost brokerage services and reliable investment advice, which attracts and retains a large client base. This brand recognition provides a competitive advantage in a crowded market.
Schwab's scale allows it to offer a wide range of services at competitive prices, benefiting from economies of scale in technology, operations, and marketing. The company's extensive branch network and online platform provide convenient access for clients, further enhancing its competitive position. The integration of TD Ameritrade has further strengthened Schwab's scale advantage, creating a dominant player in the industry.
The company's network of independent investment advisors provides a valuable distribution channel and reinforces its competitive advantage. These advisors rely on Schwab's custodial and trading services, creating a sticky relationship that is difficult for competitors to replicate. The company's advisor services segment generates a stable stream of revenue and contributes to its overall profitability.
However, the moat is not wide due to increasing competition from fintech companies offering commission-free trading and automated investment advice. These disruptors are challenging Schwab's traditional business model and putting pressure on its fees. While Schwab has responded by eliminating commissions on stock trades, it still faces the risk of further fee compression. The company's reliance on interest rate spreads also exposes it to macroeconomic headwinds, which can impact its profitability and limit its ability to invest in growth initiatives.
Furthermore, regulatory changes could potentially erode Schwab's competitive advantage. Increased scrutiny of brokerage practices and investment advice could lead to higher compliance costs and stricter regulations, which could disproportionately impact larger players like Schwab. The company's ability to adapt to these changes will be crucial in maintaining its moat over the long term.
Financial Health & Profitability
Schwab's financial health is a mixed bag. The company has demonstrated strong revenue growth, with revenue increasing from $18.84 billion in FY2023 to $23.92 billion in FY2025. This growth is partly attributable to the acquisition of TD Ameritrade and increased client engagement. Net income has also shown improvement, rising from $5.07 billion in FY2023 to $8.85 billion in FY2025, indicating enhanced profitability.
The company's operating margin is impressive, standing at 44.8% compared to the sector average of 22.0%. This suggests that Schwab is highly efficient in managing its expenses and generating profits from its operations. The net margin of 34.5% also exceeds the sector average of 17.8%, further highlighting the company's strong profitability.
However, Schwab's balance sheet raises some concerns. The company has a high debt-to-equity ratio of 893.00, significantly higher than the sector average of 115.00. This indicates that Schwab is heavily leveraged, which could increase its financial risk in a rising interest rate environment. The company's total debt stands at $165.39 billion, while its total cash is $30.57 billion, suggesting a need for careful debt management.
The company's free cash flow is negative, at -$20.41 billion. This is a significant concern, as it indicates that Schwab is not generating enough cash from its operations to cover its capital expenditures and other obligations. However, it is important to note that financial companies often have volatile free cash flow due to the nature of their business. The current ratio of 1.11 suggests that Schwab has sufficient liquid assets to cover its short-term liabilities.
The company's ROE of 15.8% is significantly higher than the sector average of 8.5%, indicating that Schwab is effectively utilizing its equity to generate profits. Overall, Schwab's financial health is characterized by strong profitability and revenue growth, but also by high leverage and negative free cash flow. Investors should closely monitor the company's debt levels and cash flow generation in the coming quarters.
Valuation Assessment
Schwab's valuation presents a mixed picture. The company's P/E ratio of 20.3x is higher than the sector average of 15.5x, suggesting that the stock is relatively expensive compared to its peers. However, the company's strong growth prospects and dominant market position may justify a premium valuation. The EV/EBITDA ratio of 3.6x is slightly above the sector average of 3.5x, indicating that the company is fairly valued on an enterprise value basis.
Given the company's historical growth and profitability, a premium valuation may be warranted. However, the high debt levels and negative free cash flow raise concerns about the sustainability of this premium. Investors should carefully consider the risks associated with Schwab's leverage and macroeconomic sensitivity when assessing its valuation.
A discounted cash flow (DCF) analysis would be necessary to determine a more precise fair value for the stock. However, without detailed projections of future cash flows, it is difficult to assess the intrinsic value of the company. Based on the available data, Schwab appears to be fairly valued to slightly overvalued, considering its growth prospects, profitability, and financial risks.
The market's perception of Schwab's integration of TD Ameritrade and its ability to navigate the changing interest rate environment will likely influence its valuation in the near term. Positive developments in these areas could lead to an increase in the stock price, while negative surprises could result in a decline. Investors should closely monitor these factors when making investment decisions.
Risk & Uncertainty
Several risks and uncertainties could impact Schwab's future performance. One of the most significant risks is the integration of TD Ameritrade. The integration process is complex and could face unexpected challenges, such as technology integration issues, client attrition, and regulatory hurdles. Failure to successfully integrate TD Ameritrade could negatively impact Schwab's earnings and growth prospects.
Another key risk is the company's sensitivity to interest rate changes. Schwab's net interest revenue is heavily influenced by interest rate spreads, and a decline in interest rates could compress its margins and reduce its profitability. The company actively manages its interest rate risk, but it remains a significant factor in its financial performance. A prolonged period of low interest rates could put pressure on Schwab's earnings and limit its ability to invest in growth initiatives.
Increased competition from fintech companies also poses a threat to Schwab's business. These disruptors are offering commission-free trading and automated investment advice, which could attract clients away from traditional brokerage firms like Schwab. The company has responded by eliminating commissions on stock trades, but it still faces the risk of further fee compression. Schwab's ability to innovate and adapt to the changing competitive landscape will be crucial in maintaining its market share.
Regulatory changes could also impact Schwab's business. Increased scrutiny of brokerage practices and investment advice could lead to higher compliance costs and stricter regulations. The company's ability to comply with these regulations and adapt to the changing regulatory environment will be essential in maintaining its competitive position. Cybersecurity risks and data breaches also pose a threat to Schwab's reputation and financial performance. A major data breach could result in significant financial losses and damage the company's brand.
Bulls Say / Bears Say
The Bull Case
BULL VIEWSchwab's acquisition of TD Ameritrade creates significant synergies and cost savings, leading to enhanced profitability and market share gains.
BULL VIEWThe company's strong brand reputation and scale provide a durable competitive advantage, allowing it to attract and retain clients in a crowded market.
BULL VIEWRising interest rates will boost Schwab's net interest revenue, driving earnings growth and improving its financial performance.
The Bear Case
BEAR VIEWSchwab's high debt levels and negative free cash flow raise concerns about its financial flexibility and ability to invest in growth initiatives.
BEAR VIEWIncreased competition from fintech companies will put pressure on Schwab's fees and margins, eroding its profitability.
BEAR VIEWThe integration of TD Ameritrade is complex and could face unexpected challenges, negatively impacting Schwab's earnings and growth prospects.
About the Author
Marques Blank
Founder & Chief Investment Officer, Blank Capital
Marques brings 15 years of institutional finance and investing experience, having overseen financial planning for a $1.6B defense business unit. He developed the proprietary 6-factor quantitative model used to score SCHW and 4,400+ other equities.
SCHWAB CHARLES CORP exhibits a 326% valuation premium relative to institutional benchmarks. This represents a potential valuation overextension based on current multiples.
Return on Assets
Efficiency of asset utilization
1.6%
Sector: 1.2%
Gross Margin
Pricing power and cost efficiency
0.0%
Sector: 0.0%
Operating Margin
Core business profitability
44.8%
Sector: 21.8%
Net Margin
Bottom-line profitability
34.5%
Sector: 17.7%
Factor Methodology
The Quality factor evaluates the persistence and magnitude of cash flows. Companies with scores >70 exhibit superior competitive moats and financial resilience through economic cycles.
Sector Avg Yield2.48%
Yield Delta-55%
Income Projection audit
A $10,000 investment would generate approximately $111 annually in dividends at the current trailing rate.
