SCHWAB (CHARLES) CORP (SCHW) Stock Fundamental Analysis
NYSE:SCHW - New York Stock Exchange, Inc. - US8085131055 - Common Stock - Currency: USD
Overall SCHW gets a fundamental rating of 4 out of 10. We evaluated SCHW against 233 industry peers in the Capital Markets industry. SCHW has a medium profitability rating, but doesn't score so well on its financial health evaluation. SCHW has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year SCHW was profitable.
SCHW had a positive operating cash flow in the past year.
SCHW had positive earnings in each of the past 5 years.
Each year in the past 5 years SCHW had a positive operating cash flow.
1.2 Ratios
SCHW has a worse Return On Assets (1.30%) than 61.11% of its industry peers.
SCHW's Return On Equity of 12.16% is fine compared to the rest of the industry. SCHW outperforms 67.95% of its industry peers.
With a Return On Invested Capital value of 1.98%, SCHW is not doing good in the industry: 66.24% of the companies in the same industry are doing better.
SCHW had an Average Return On Invested Capital over the past 3 years of 1.61%. This is significantly below the industry average of 7.84%.
The 3 year average ROIC (1.61%) for SCHW is below the current ROIC(1.98%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.3% | ||
| ROE | 12.16% | ||
| ROIC | 1.98% |
ROA(3y)1.1%
ROA(5y)0.93%
ROE(3y)13.6%
ROE(5y)11.15%
ROIC(3y)1.61%
ROIC(5y)1.38%
1.3 Margins
With a decent Profit Margin value of 22.99%, SCHW is doing good in the industry, outperforming 63.68% of the companies in the same industry.
In the last couple of years the Profit Margin of SCHW has declined.
SCHW has a Operating Margin (32.31%) which is comparable to the rest of the industry.
SCHW's Operating Margin has declined in the last couple of years.
Looking at the Gross Margin, with a value of 78.11%, SCHW belongs to the top of the industry, outperforming 83.33% of the companies in the same industry.
In the last couple of years the Gross Margin of SCHW has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 32.31% | ||
| PM (TTM) | 22.99% | ||
| GM | 78.11% |
OM growth 3Y-11.01%
OM growth 5Y-5.93%
PM growth 3Y-9.28%
PM growth 5Y-6.77%
GM growth 3Y-8.21%
GM growth 5Y-3.68%
2. Health
2.1 Basic Checks
Compared to 1 year ago, SCHW has more shares outstanding
SCHW has more shares outstanding than it did 5 years ago.
SCHW has a better debt/assets ratio than last year.
2.2 Solvency
Based on the Altman-Z score of -0.23, we must say that SCHW is in the distress zone and has some risk of bankruptcy.
SCHW's Altman-Z score of -0.23 is on the low side compared to the rest of the industry. SCHW is outperformed by 79.49% of its industry peers.
SCHW has a debt to FCF ratio of 29.22. This is a negative value and a sign of low solvency as SCHW would need 29.22 years to pay back of all of its debts.
SCHW's Debt to FCF ratio of 29.22 is in line compared to the rest of the industry. SCHW outperforms 45.73% of its industry peers.
A Debt/Equity ratio of 5.78 is on the high side and indicates that SCHW has dependencies on debt financing.
The Debt to Equity ratio of SCHW (5.78) is worse than 86.75% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 5.78 | ||
| Debt/FCF | 29.22 | ||
| Altman-Z | -0.23 |
ROIC/WACCN/A
WACCN/A
2.3 Liquidity
A Current Ratio of 0.31 indicates that SCHW may have some problems paying its short term obligations.
SCHW's Current ratio of 0.31 is on the low side compared to the rest of the industry. SCHW is outperformed by 84.62% of its industry peers.
A Quick Ratio of 0.31 indicates that SCHW may have some problems paying its short term obligations.
SCHW has a Quick ratio of 0.31. This is amonst the worse of the industry: SCHW underperforms 84.62% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.31 | ||
| Quick Ratio | 0.31 |
3. Growth
3.1 Past
SCHW shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 20.75%, which is quite impressive.
The Earnings Per Share has been growing slightly by 3.62% on average over the past years.
SCHW shows a small growth in Revenue. In the last year, the Revenue has grown by 2.32%.
The Revenue has been growing by 17.15% on average over the past years. This is quite good.
EPS 1Y (TTM)20.75%
EPS 3Y-0.91%
EPS 5Y3.62%
EPS Q2Q%40.54%
Revenue 1Y (TTM)2.32%
Revenue growth 3Y11.03%
Revenue growth 5Y17.15%
Sales Q2Q%18.12%
3.2 Future
The Earnings Per Share is expected to grow by 18.93% on average over the next years. This is quite good.
The Revenue is expected to grow by 11.09% on average over the next years. This is quite good.
EPS Next Y38.12%
EPS Next 2Y27.64%
EPS Next 3Y24.13%
EPS Next 5Y18.93%
Revenue Next Year16.96%
Revenue Next 2Y13.62%
Revenue Next 3Y11.87%
Revenue Next 5Y11.09%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The estimated forward Revenue growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 25.91 indicates a quite expensive valuation of SCHW.
Based on the Price/Earnings ratio, SCHW is valued a bit more expensive than the industry average as 63.68% of the companies are valued more cheaply.
SCHW is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 27.30, which is the current average of the S&P500 Index.
SCHW is valuated rather expensively with a Price/Forward Earnings ratio of 17.37.
Compared to the rest of the industry, the Price/Forward Earnings ratio of SCHW is on the same level as its industry peers.
SCHW is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 21.76, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.91 | ||
| Fwd PE | 17.37 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of SCHW indicates a somewhat cheap valuation: SCHW is cheaper than 79.91% of the companies listed in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of SCHW indicates a somewhat cheap valuation: SCHW is cheaper than 62.39% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 17.07 | ||
| EV/EBITDA | 15.53 |
4.3 Compensation for Growth
SCHW's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
SCHW's earnings are expected to grow with 24.13% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.68
PEG (5Y)7.15
EPS Next 2Y27.64%
EPS Next 3Y24.13%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.13%, SCHW has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 8.12, SCHW is paying slightly less dividend.
With a Dividend Yield of 1.13, SCHW pays less dividend than the S&P500 average, which is at 2.35.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.13% |
5.2 History
On average, the dividend of SCHW grows each year by 8.99%, which is quite nice.
SCHW has paid a dividend for at least 10 years, which is a reliable track record.
SCHW has decreased its dividend recently.
Dividend Growth(5Y)8.99%
Div Incr Years0
Div Non Decr Years1
5.3 Sustainability
SCHW pays out 38.32% of its income as dividend. This is a sustainable payout ratio.
The dividend of SCHW is growing, but earnings are growing more, so the dividend growth is sustainable.
DP38.32%
EPS Next 2Y27.64%
EPS Next 3Y24.13%
91.97
-1.07 (-1.15%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryCapital Markets
Earnings (Last)
Earnings (Next)
Inst Owners84.63%
Inst Owner Change0%
Ins Owners5.98%
Ins Owner Change22.32%
Market Cap167.11B
Analysts81.38
Price Target93.3 (1.45%)
Short Float %1.02%
Short Ratio2.15
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.13% |
Yearly Dividend1.25
Dividend Growth(5Y)8.99%
DP38.32%
Div Incr Years0
Div Non Decr Years1
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)4.72%
Min EPS beat(2)1.21%
Max EPS beat(2)8.23%
EPS beat(4)3
Avg EPS beat(4)2.49%
Min EPS beat(4)-0.17%
Max EPS beat(4)8.23%
EPS beat(8)6
Avg EPS beat(8)2.26%
EPS beat(12)9
Avg EPS beat(12)2.05%
EPS beat(16)11
Avg EPS beat(16)1.34%
Revenue beat(2)1
Avg Revenue beat(2)0.11%
Min Revenue beat(2)-0.5%
Max Revenue beat(2)0.72%
Revenue beat(4)1
Avg Revenue beat(4)-0.54%
Min Revenue beat(4)-1.76%
Max Revenue beat(4)0.72%
Revenue beat(8)1
Avg Revenue beat(8)-1.18%
Revenue beat(12)5
Avg Revenue beat(12)2.73%
Revenue beat(16)7
Avg Revenue beat(16)2.07%
PT rev (1m)1.16%
PT rev (3m)2.84%
EPS NQ rev (1m)1.67%
EPS NQ rev (3m)5.89%
EPS NY rev (1m)2.23%
EPS NY rev (3m)4.24%
Revenue NQ rev (1m)1.22%
Revenue NQ rev (3m)3.03%
Revenue NY rev (1m)0.64%
Revenue NY rev (3m)1.12%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.91 | ||
| Fwd PE | 17.37 | ||
| P/S | 6.38 | ||
| P/FCF | 17.07 | ||
| P/OCF | 16.1 | ||
| P/B | 3.38 | ||
| P/tB | 5.58 | ||
| EV/EBITDA | 15.53 |
EPS(TTM)3.55
EY3.86%
EPS(NY)5.3
Fwd EY5.76%
FCF(TTM)5.39
FCFY5.86%
OCF(TTM)5.71
OCFY6.21%
SpS14.42
BVpS27.25
TBVpS16.48
PEG (NY)0.68
PEG (5Y)7.15
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.3% | ||
| ROE | 12.16% | ||
| ROCE | 11.93% | ||
| ROIC | 1.98% | ||
| ROICexc | 2.21% | ||
| ROICexgc | 2.47% | ||
| OM | 32.31% | ||
| PM (TTM) | 22.99% | ||
| GM | 78.11% | ||
| FCFM | 37.37% |
ROA(3y)1.1%
ROA(5y)0.93%
ROE(3y)13.6%
ROE(5y)11.15%
ROIC(3y)1.61%
ROIC(5y)1.38%
ROICexc(3y)1.81%
ROICexc(5y)1.55%
ROICexgc(3y)1.99%
ROICexgc(5y)1.69%
ROCE(3y)12.72%
ROCE(5y)11.16%
ROICexcg growth 3Y13.97%
ROICexcg growth 5Y4.46%
ROICexc growth 3Y12.7%
ROICexc growth 5Y2.85%
OM growth 3Y-11.01%
OM growth 5Y-5.93%
PM growth 3Y-9.28%
PM growth 5Y-6.77%
GM growth 3Y-8.21%
GM growth 5Y-3.68%
F-Score9
Asset Turnover0.06
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 5.78 | ||
| Debt/FCF | 29.22 | ||
| Debt/EBITDA | 28.92 | ||
| Cap/Depr | 41.29% | ||
| Cap/Sales | 2.24% | ||
| Interest Coverage | 1.44 | ||
| Cash Conversion | 104.93% | ||
| Profit Quality | 162.54% | ||
| Current Ratio | 0.31 | ||
| Quick Ratio | 0.31 | ||
| Altman-Z | -0.23 |
F-Score9
WACCN/A
ROIC/WACCN/A
Cap/Depr(3y)57.78%
Cap/Depr(5y)71.3%
Cap/Sales(3y)3.16%
Cap/Sales(5y)3.9%
Profit Quality(3y)153.35%
Profit Quality(5y)137.38%
High Growth Momentum
Growth
EPS 1Y (TTM)20.75%
EPS 3Y-0.91%
EPS 5Y3.62%
EPS Q2Q%40.54%
EPS Next Y38.12%
EPS Next 2Y27.64%
EPS Next 3Y24.13%
EPS Next 5Y18.93%
Revenue 1Y (TTM)2.32%
Revenue growth 3Y11.03%
Revenue growth 5Y17.15%
Sales Q2Q%18.12%
Revenue Next Year16.96%
Revenue Next 2Y13.62%
Revenue Next 3Y11.87%
Revenue Next 5Y11.09%
EBIT growth 1Y33.18%
EBIT growth 3Y-1.2%
EBIT growth 5Y10.19%
EBIT Next Year47.79%
EBIT Next 3Y23.5%
EBIT Next 5Y17.53%
FCF growth 1Y23.19%
FCF growth 3Y19.48%
FCF growth 5Y-24.96%
OCF growth 1Y18.19%
OCF growth 3Y8.03%
OCF growth 5Y-22.13%