Fact based stock research
Charles Schwab (NYSE:SCHW)
US8085131055
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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Charles Schwab stock research in summary
ANALYSIS: With an Obermatt Combined Rank of 9 (worse than 91% compared with investment alternatives), Charles Schwab (Investment Banking & Brokerage, USA) shares have lower financial characteristics compared with similar stocks. Shares of Charles Schwab are low in value (priced high) with a consolidated Value Rank of 8 (worse than 92% of alternatives), and are riskily financed (Safety Rank of 9, which means above-average debt burdens) but show above-average growth (Growth Rank of 77). ...read more
RECOMMENDATION: A Combined Rank of 9, is a sell recommendation based on Charles Schwab's financial characteristics. As the company Charles Schwab shows low value with an Obermatt Value Rank of 8 (92% of comparable investments are less expensive), investors should look at the other ranks. In this case, growth is expected to be above-average, better than 77% of comparable companies (Obermatt Growth Rank is 77). This is a typical case. Companies with above average growth tend to cost more than stocks with slower growth expectations. If this is a high-growth company, the low Obermatt Safety Rank of 9 is a good sign. The more debt a well-performing company has, the higher the returns to shareholders. However, if growth turns negative or interest rates increase, high debt may become a burden. If you believe the future is bright for Charles Schwab, even a low-value company (in terms of its key financial indicators) can be a good investment. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more
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360° Viewnew| Country | USA |
| Industry | Investment Banking & Brokerage |
| Index | D.J. US Investing, S&P 500 |
| Size class | XX-Large |
25-Apr-2024. Stock data may be delayed. Log in or sign up to get the most recent research.
Analysts rarely agree on a stock’s future. So, who do you believe? Obermatt translates those collective views into a single Sentiment Rank. That plus the financial ranks give you the ultimate 360° View. Sign up to access them.
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Review the performance ranks of the individual metrics that form each investment strategy.
Research History: Charles Schwab
| RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 13 |
|
6 |
|
8 |
|
8 |
|
| GROWTH | ||||||||
| GROWTH | 97 |
|
100 |
|
33 |
|
77 |
|
| SAFETY | ||||||||
| SAFETY | 90 |
|
9 |
|
13 |
|
9 |
|
| SENTIMENT | ||||||||
| SENTIMENT | n/a |
|
48 |
|
14 |
|
new |
|
| 360° VIEW | ||||||||
| 360° VIEW | n/a |
|
18 |
|
1 |
|
new |
|
Combined financial peformance in Detail
ANALYSIS: With an Obermatt Combined Rank of 9 (worse than 91% compared with investment alternatives), Charles Schwab (Investment Banking & Brokerage, USA) shares have lower financial characteristics compared with similar stocks. Shares of Charles Schwab are low in value (priced high) with a consolidated Value Rank of 8 (worse than 92% of alternatives), and are riskily financed (Safety Rank of 9, which means above-average debt burdens) but show above-average growth (Growth Rank of 77). ...read more
RECOMMENDATION: A Combined Rank of 9, is a sell recommendation based on Charles Schwab's financial characteristics. As the company Charles Schwab shows low value with an Obermatt Value Rank of 8 (92% of comparable investments are less expensive), investors should look at the other ranks. In this case, growth is expected to be above-average, better than 77% of comparable companies (Obermatt Growth Rank is 77). This is a typical case. Companies with above average growth tend to cost more than stocks with slower growth expectations. If this is a high-growth company, the low Obermatt Safety Rank of 9 is a good sign. The more debt a well-performing company has, the higher the returns to shareholders. However, if growth turns negative or interest rates increase, high debt may become a burden. If you believe the future is bright for Charles Schwab, even a low-value company (in terms of its key financial indicators) can be a good investment. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more
| RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 13 |
|
6 |
|
8 |
|
8 |
|
| GROWTH | ||||||||
| GROWTH | 97 |
|
100 |
|
33 |
|
77 |
|
| SAFETY | ||||||||
| SAFETY | 90 |
|
9 |
|
13 |
|
9 |
|
| COMBINED | ||||||||
| COMBINED | 87 |
|
14 |
|
1 |
|
9 |
|
Value Metrics in Detail
ANALYSIS: With an Obermatt Value Rank of 8 (worse than 92% compared with alternatives), Charles Schwab shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with all four indicators below average for Charles Schwab. Price-to-Sales is 14 which means that the stock price compared with what market professionals expect for future profits is higher than 86% of comparable companies, indicating a low value concerning Charles Schwab's sales levels. Price-to-Book Capital (also referred to as market-to-book ratio) also has a low Price-to-Book Rank of 33, which means that both reliable company size indicators, sales, and invested capital cannot explain the high stock price of Charles Schwab. In addition, the two profit-related value indicators, Price-to-Profit (also referred to as price-earnings, P/E) with a low rank of 31 and Dividend Yield, which is lower than 68% of comparable companies, also make the stock more expensive compared with investment alternatives. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 8, is a sell recommendation based on Charles Schwab's stock price compared with the company's operational size and dividend yields. How can market participants pay such a high price for Charles Schwab? One reason may be that the company is simply too popular. If enough people want a particular stock, its price can exceed reasonable levels. This is often the case for companies offering new and exciting products and everybody wants a piece of the action. Should you pay a lot for a hot stock such as Charles Schwab? It's risky, and even if the stock price continues to grow because of popular demand, it may return to more typical lower levels later. And that return can be sudden and quick, making it impossible for retail investors to exit on time. Sometimes, high prices are deserved. This is the case when it is justified to believe that the company will dominate a market with high profit margins. It has happened in the past for many technology companies and indeed for commercially successful pharmaceutical discoveries. Sometimes they last, sometimes, they get eaten alive. Charles Schwab may be such a type of stock. That would mean, retail investors should be careful, only considering investing a small part of their wealth in this exciting category and always being ready to lose more than half, if not all of the investment. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is essential in this case, as the financial indicators are inconclusive. ...read more
| VALUE METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| PRICE VS. REVENUES (P/S) | ||||||||
| PRICE VS. REVENUES (P/S) | 16 |
|
9 |
|
16 |
|
14 |
|
| PRICE VS. PROFITS (P/E) | ||||||||
| PRICE VS. PROFITS (P/E) | 34 |
|
13 |
|
34 |
|
31 |
|
| PRICE VS. CAPITAL (Market-to-Book) | ||||||||
| PRICE VS. CAPITAL (Market-to-Book) | 31 |
|
32 |
|
30 |
|
33 |
|
| DIVIDEND YIELD | ||||||||
| DIVIDEND YIELD | 35 |
|
27 |
|
34 |
|
32 |
|
| CONSOLIDATED RANK: VALUE | ||||||||
| CONSOLIDATED RANK: VALUE | 13 |
|
6 |
|
8 |
|
8 |
|
Growth Metrics in Detail
ANALYSIS: With an Obermatt Growth Rank of 77 (better than 77% compared with alternatives) for 2024, Charles Schwab shows one of the highest growth dynamics in its industry. Investors also speak of high momentum. The Growth Rank is based on consolidating four value indicators, with all but one indicator above average for Charles Schwab. Sales Growth has a rank of 81 which means that currently, professionals expect the company to grow more than 81% of its competitors. Capital Growth is also above 19% of competitors with a rank of 83, and Stock Returns with the rank of 80 is also an outperformance. Only Profit Growth is low with a rank of 19 which means that currently, professionals expect the company to grow its profits less than 81% of its competitors. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 77, is a buy recommendation for growth and momentum investors. All three operating growth indicators, namely revenue, profit, and capital growth, are showing improvements. This is a good indication of a company with a positive future. That might, at the same time, be the simple reason why profit growth is low. A growing company needs money and thus can't yet show high profit growth. Look out for signs in corporate communication about extra growth efforts costing time and money. If that is the case, Charles Schwab is a good growth stock. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case. ...read more
| GROWTH METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 87 |
|
58 |
|
48 |
|
81 |
|
| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 60 |
|
87 |
|
17 |
|
19 |
|
| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | n/a |
|
64 |
|
90 |
|
83 |
|
| STOCK RETURNS | ||||||||
| STOCK RETURNS | 92 |
|
96 |
|
3 |
|
80 |
|
| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 97 |
|
100 |
|
33 |
|
77 |
|
Safety Metrics in Detail
ANALYSIS: With an Obermatt Safety Rank of 9 (better than 9% compared with alternatives), the company Charles Schwab has much riskier financing practices than comparable other companies, which means that their overall debt burden is significantly above the industry average. This doesn't mean that the business of Charles Schwab is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with just one indicator above average for Charles Schwab and the other two below average. Refinancing is at 83, meaning the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 83% of its competitors. But Leverage is high with a rank of 9, meaning the company has an above-average debt-to-equity ratio. It has more debt than 91% of its competitors. Liquidity is also on the riskier side with a rank of 11, meaning the company generates less profit to service its debt than 89% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 9 (worse than 91% compared with alternatives), Charles Schwab has a financing structure that is significantly riskier than that of its competitors. A good Refinancing Rank means that the problems of the company may not be around the corner. But high Leverage is only good if things go well, and low Liquidity is a signal for caution. The financing signals for Charles Schwab are on the riskier side, requiring the company's future to be on the safer side. Investors may want to look at Growth and Sentiment ranks before making an investment decision. In the long-term, investors may have a debt challenge with Charles Schwab and should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more
| SAFETY METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 76 |
|
9 |
|
5 |
|
9 |
|
| REFINANCING | ||||||||
| REFINANCING | 92 |
|
78 |
|
83 |
|
83 |
|
| LIQUIDITY | ||||||||
| LIQUIDITY | 87 |
|
4 |
|
10 |
|
11 |
|
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 90 |
|
9 |
|
13 |
|
9 |
|
Sentiment Metrics in Detail
| SENTIMENT | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| ANALYST OPINIONS | ||||||||
| ANALYST OPINIONS | n/a |
|
64 |
|
80 |
|
new |
|
| OPINIONS CHANGE | ||||||||
| OPINIONS CHANGE | n/a |
|
45 |
|
15 |
|
new |
|
| PRO HOLDINGS | ||||||||
| PRO HOLDINGS | n/a |
|
14 |
|
10 |
|
new |
|
| MARKET PULSE | ||||||||
| MARKET PULSE | n/a |
|
72 |
|
24 |
|
new |
|
| CONSOLIDATED RANK: SENTIMENT | ||||||||
| CONSOLIDATED RANK: SENTIMENT | n/a |
|
48 |
|
14 |
|
new |
|
Stock analysis by the purely fact based Obermatt Method for Charles Schwab from April 25, 2024.
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