Key Stats for Charles Schwab Stock
- 52-Week Range: $84 to $108
- Current Price: $89
- Street Mean Target: $115
- Street High Target: $131
- Analyst Consensus: 11 Buys, 8 Outperforms, 2 Holds, 1 Underperform
- TIKR Model Target (Dec. 2030): $159
What Happened?
The Charles Schwab Corporation (SCHW) iis the largest retail brokerage in the United States, offering securities trading, wealth management, banking, asset management, and financial advisory services across roughly 47 million client accounts.
Charles Schwab stock has pulled back from its 52-week high of $107.50 to the current $88.61 even as the business delivered one of its strongest quarters on record.
In Q1 FY26, Schwab posted net revenues of $6.48 billion, up 16% year over year, with every major revenue line growing at double digits.
Net income climbed 30% to $2.48 billion, while diluted EPS rose 38% to $1.37 and adjusted EPS hit a record $1.43, beating the consensus estimate of $1.40.
The pre-tax profit margin widened 5.4 percentage points to 49.2%, with the adjusted figure reaching 51.4%.
“Clients continue to turn to us for more of their financial lives, helping wealth and banking solutions reach record levels in Q1,” CEO Rick Wurster said on the Q1 2026 earnings call.
Client growth drove the financial performance rather than market luck: 1.3 million new brokerage accounts were opened in Q1, up 10% year over year, while core net new assets reached $158 billion excluding a one-time mutual fund clearing outflow, a first-quarter record.
Total client assets stood at $11.77 trillion at quarter-end, up 19% from a year earlier.
Daily average trades hit a record 9.9 million, up 34% year over year, and trading revenue surged 20% as clients actively repositioned through a volatile macro environment driven by the U.S.-Israeli conflict with Iran and associated oil price spikes.
On March 2, Schwab completed its $636 million acquisition of Forge Global Holdings, which brings a private markets platform into the Schwab ecosystem and creates a pipeline for pre-IPO share access, capital table management, and lending solutions for private company employees and equity holders.
Schwab also began an employee pilot of spot crypto trading in Q1, with a phased retail client rollout of Bitcoin and Ether expected in the coming weeks, priced at 75 basis points per trade.
CFO Mike Verdeschi also noted on the call that, based on Q1 results and the expected path of rates, Schwab is “tracking higher than the $5.70 to $5.80 EPS range” implied by its January scenario, which excluded buybacks and Forge impacts.
Managed investing net flows grew 46% year over year, reaching an all-time record, led by Schwab Wealth Advisory where net flows hit $10 billion, up 90%.
Bank loans expanded 29% year over year to $61 billion, with pledged asset line and bank product balances reaching all-time records, adding a high-spread lending revenue stream that management described as “quite accretive” to earnings.
Wall Street’s Take on SCHW Stock
The Q1 beat marks the third consecutive quarter of accelerating earnings growth for Schwab, and it arrives at a moment when the market is repricing the stock’s risk rather than its fundamentals.
SCHW’s adjusted EPS grew 37.5% year over year in Q1 FY26 to $1.43, and consensus estimates put the next four quarters at around $1.47, $1.53, $1.60, and $1.65, implying roughly 29% full-year EPS growth in 2026 and continued double-digit compounding into 2027.
Nineteen analysts rate Charles Schwab stock as a Buy or Outperform, with 2 Holds and 1 Underperform; the mean price target sits at $115, implying 30% upside from the current price, with the high target at $131 from JPMorgan and $125 from Morgan Stanley.
What Does the Valuation Model Say?
The TIKR model prices SCHW at a mid-case target of around $225 by December 2034, implying a total return of roughly 154% and an annualized IRR of around 11%, built on a revenue CAGR of around 7% and net income margins expanding toward 41%.
Trading at 14.18x NTM normalized EPS against a historical mean of 18.77x, Charles Schwab stock sits at its widest discount to its own average multiple in years, even as adjusted EPS just hit a record $1.43 and net new assets reached a first-quarter all-time high, leaving the stock undervalued by a margin the earnings trajectory does not justify.
The central tension for Charles Schwab stock is whether its net interest revenue model is durable enough to fund the earnings growth implied by consensus, or whether AI and tokenization erode the frictions that have historically made cash sweep a high-margin revenue line.
Bull Case
- Adjusted EPS grew 37.5% in Q1 FY26 to $1.43, tracking above Schwab’s own $5.70 to $5.80 annual scenario, with consensus putting 2026 EPS at around $6 and 2027 at around $6.80
- Bank loans expanded 29% year over year to $61 billion, with pledged asset line balances at all-time records, creating a lending revenue stream that runs at spreads well above the securities portfolio
- The Forge Global acquisition for $636 million adds a private markets platform with no meaningful revenue contribution yet, meaning every dollar of pre-IPO deal flow is upside to current estimates
- Managed investing net flows grew 46% to an all-time record, with Schwab Wealth Advisory alone posting $10 billion in Q1 flows, up 90% year over year
- The spot crypto rollout at 75 basis points per trade across a 47-million-account base represents an entirely new fee stream with near-zero marginal cost of distribution
Bear Case
- The Q1 NII came in roughly 1% below consensus, and Piper Sandler’s neutral thesis holds that AI-driven cash optimization could accelerate sorting away from the sweep program that funds a significant portion of net interest revenue
- Client transactional cash as a share of assets sits near 4%, and any product innovation by JPMorgan or other competitors that further reduces cash sweep balances would compress NIM in a manner not captured by current estimates
- The five-year historical P/E mean of around 22x assumes a rate environment and margin structure that the post-2022 balance sheet transition has permanently altered; if the normalized forward multiple settles closer to 18x, the TIKR mid-case return compresses materially
- With co-chairman Charles R. Schwab selling more than $40 million in shares across April and early May, insider activity adds a modest but visible overhang to the stock in the near term
Should You Invest in The Charles Schwab Corporation?
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