In the last trading session, SCHW stock traded at $50.77, experiencing a decrease of $0.72, which represents a 1.40% drop in value. Charles Schwab is scheduled to release its earnings report prior to market open, with a management conference call to follow at 9 a.m. ET.
In the last quarter, SCHW posted Q4 net revenue of $5.49 billion, marking a 17% YoY increase, and an adjusted EPS of $1.07, reflecting a 24% growth. For the current quarter, Refinitiv-sourced analyst consensus anticipates double-digit earnings growth for the brokerage firm.
Charles Schwab was implicated in the recent banking turmoil following the collapse of Silicon Valley Bank and Signature Bank, as market participants speculated about potential client withdrawals impacting the brokerage. The stock has declined 39% year-to-date as of Friday’s close. In response, the company highlighted its low loan-to-deposit ratio and robust liquidity last month. Investors should also monitor any indications of how cash sorting—clients transferring funds from low-yielding deposit accounts to higher-yielding ones—has affected Schwab’s Q1 performance. Piper Sandler analyst Richard Repetto noted, “Year-to-date, SCHW’s consensus ’23 EPS estimate has decreased by 23% to $3.77 currently,” attributing the decline mainly to ongoing client cash sorting.
Historical performance: Bespoke Investment Group’s compiled data indicates that Schwab outperforms earnings expectations 55% of the time, with the stock averaging a 0.3% gain on earnings day. However, Schwab’s shares experienced a decline of over 2% on the last two earnings days.