What's Going On With Charles Schwab Shares Today?
Portfolio Pulse from Lekha Gupta
Charles Schwab Corporation (NYSE:SCHW) reported a decline in its first-quarter 2024 financial results, with adjusted net income down 17% Y/Y to $1.469 billion and adjusted EPS falling 20% Y/Y to $0.74, aligning with consensus. Revenue decreased by 7% to $4.74 billion, slightly above the consensus of $4.71 billion. Despite a decrease in deposits and net interest revenue, the company saw a 21% increase in asset management and administration fees and attracted $96 billion in core net new assets. Schwab's total client assets reached $9.12 trillion, and it added 1 million new brokerage accounts. The company's pre-tax profit margins expanded, and its capital position was bolstered. SCHW shares are down 1.80% in premarket trading. Exposure to SCHW can also be gained through IShares U.S. Broker-Dealers & Securities Exchanges ETF (NYSE:IAI) and Tidal ETF Trust God Bless America ETF (NYSE:YALL).
April 15, 2024 | 1:01 pm
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NEGATIVE IMPACT
Charles Schwab reported a decline in Q1 2024 earnings with adjusted net income and EPS down, but saw an increase in asset management fees and new assets. Shares are down 1.80% premarket.
The decline in net income and EPS, despite being in line with consensus, along with the premarket stock price drop, suggests a negative short-term impact on SCHW's stock price. However, the increase in asset management fees and new assets indicates underlying strengths.
CONFIDENCE 90
IMPORTANCE 90
RELEVANCE 100
NEUTRAL IMPACT
Investors can gain exposure to Charles Schwab's stock via IShares U.S. Broker-Dealers & Securities Exchanges ETF, which may be impacted by SCHW's Q1 2024 financial results.
As an ETF that includes SCHW in its holdings, IAI may experience indirect impacts from Schwab's financial performance. However, the diversified nature of ETFs means the effect is likely to be muted.
CONFIDENCE 75
IMPORTANCE 60
RELEVANCE 50
NEUTRAL IMPACT
Tidal ETF Trust God Bless America ETF, offering exposure to Charles Schwab, could see indirect effects from SCHW's Q1 2024 earnings report.
Given YALL's exposure to SCHW, the ETF could face indirect impacts from Schwab's Q1 2024 performance. The effect is expected to be limited due to the ETF's diversified portfolio.
CONFIDENCE 75
IMPORTANCE 60
RELEVANCE 50