The Charles Schwab Corporation (SCHW): Can It Get Better?

Investors will get their next glimpse of SCHW’s Q4 earnings on January 16. Analysts are forecasting revenue to climb 18.4 percent to $2.65B in the next fiscal quarter, while earnings are seen soaring by nearly 45.45 percent to $0.64 per share. History has shown that shares in The Charles Schwab Corporation have gone up on 21 different earnings reaction days and are predicted to add 0.01 percent when the company reports upcoming earnings. In last reported earnings results, it earned $0.65 per share, in line with the $0.65, adjusted, expected by Thomson Reuters consensus estimate. Revenue was $2.58B, in line with the $2.58B analysts expected. Earnings are estimated to increase by 25.7 percent this year, 18.5 percent next year and continue to increase by 27.52 percent annually for the next 5 years.

The Charles Schwab Corporation (SCHW) will probably climb 23.64 percent over the next 12 months, according to price target estimates compiled by finviz. Meanwhile, they have set a $66 as 1-year high price target. This represents a whopping 46.37 percent increase from where shares are trading today. The 12-month median price target assigned by the analysts stands at $54, which represents a return potential of 19.76 percent when compared to the closing price of the stock of $45.09 on Monday, November 26. The lowest price target for the stock is $46 — slightly more than 2.02 percent from SCHW’s current share price.

The stock is currently hovering around the first support level of $44.63. Below this, the next support is placed in the zone of $44.18. Till the time, the SCHW stock trades above this level, bulls have nothing to fear. On momentum oscillators front, ‘RSI’ has touched 42.07 on daily chart, which may remain a cause for concern. If the price breaks below $44.18 level on closing basis, then we may see more profit booking and the stock may show further weakness. On the flipside, hitting the $45.66 mark may result into a pull-back move towards $46.24 level.

On 26th of November, The Charles Schwab Corporation (NYSE:SCHW) shares ended higher after a volatile session. The shares accumulated 1.01 points or 2.29 percent at $45.09 with a heavy trade volume of 8.127 million shares. After opening the session at $45.03, the shares went as high as $45.78 and as low as $44.75, the range within which the stock’s price traded throughout the day. The firm is left with a market cap of $62 billion and now has 1.37 billion shares outstanding. The Charles Schwab Corporation (SCHW) stock has gained 4.42 percent of market value in 21 trading days.

SCHW stock has a trailing 3-year beta of 1.46, offering the possibility of a higher rate of return, but also posing more risk. The portion of a company’s profit allocated to each outstanding share of common stock was $2.23 a share in the trailing twelve months. The stock’s value has fallen -12.23 percent year to date (YTD) against a decline of -1.51 percent in 12 month’s time. The company’s shares still trade -25.12 percent away from its 1-year high of $60.22 and 7.33 percent up from 52-week low of $42.01. The average consensus rating on the company is 2.4, on a scale where 5 equates to a unanimous sell rating. In short, the mean analyst recommendations are calling this stock a sell.

Shares of The Charles Schwab Corporation (SCHW) are trading at a P/E ratio of 21.08 times earnings reported for the past 12 months. The industry SCHW operates in has an average P/E of 33.37. Its P/E ratio went as low as 30.16X and as high as 33.29 over the 5-year span. Further, it is sporting a 5.96 on the Price-to-Sales ratio. Compare this with the industry average P/S of 7.09. 93.4 percent is the gross profit margin for The Charles Schwab Corporation and operating margin sits at 41.4 percent. Along with this, the net profit margin is 28.8 percent.

Let’s take a look at some insider activity at The Charles Schwab Corporation (NYSE:SCHW) and see the pattern. The earliest insider trade took place on 11/15/2018. Schwab Charles R parted with a total of 383 thousand shares of company at average share price of $46.97. The total for the sales was set at $17.99 million. After this transaction, the Chairman, 10% Owner account balance stood at 130 million shares. The stock lost -4 percent since that insider sale. On 11/05/2018, Chandoha Marie A, President – CSIM, sold 12.4 thousand shares at a price per share of $47.18. This removed 585.03 thousand shares from the insider’s fortune and the stock saw a -4.43 percent retreat in value since the news became public. This transaction left 0 thousand shares in the President – CSIM account.

On 10/16/2018, President – CSIM Chandoha Marie A performed a sale transaction worth $404.44 thousand. This sale at $48.01 each has eliminated 8.42 thousand shares from the insider’s portfolio position. Meanwhile, shares have recorded -6.08 percent decrease since the transaction was reported. The insider now is left with 4.61 thousand shares remaining in the account. Craig Jonathan M., who performs the Senior EVP job, sold 2.63 thousand shares for $128.4 thousand. The disposal occurred on 10/15/2018 was priced at $48.84 per share. The share price plunged -7.68 percent since the reporting date. Craig Jonathan M. now left with a stake of 0 thousand SCHW stock worth $0 thousand after the insider selling.