Financial services giant Charles Schwab (NYSE: SCHW) will be reporting earnings this Wednesday before market open. Here’s what you need to know.
Charles Schwab beat analysts’ revenue expectations by 2.2% last quarter, reporting revenues of $6.14 billion, up 26.6% year on year. It was a strong quarter for the company, with and a decent beat of analysts’ revenue estimates.
Is Charles Schwab a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members.
This quarter, analysts are expecting Charles Schwab’s revenue to grow 19.4% year on year to $6.36 billion, in line with the 19.5% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $1.39 per share.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Charles Schwab has only missed Wall Street’s revenue estimates once over the last two years, exceeding top-line expectations by 1.1% on average.
Looking at Charles Schwab’s peers in the investment banking & brokerage segment, some have already reported their Q4 results, giving us a hint as to what we can expect. Jefferies delivered year-on-year revenue growth of 5.7%, beating analysts’ expectations by 3%, and Goldman Sachs reported a revenue decline of 3%, topping estimates by 0.5%. Jefferies traded down 5.6% following the results while Goldman Sachs was up 3.1%.
Read our full analysis of Jefferies’s results here and Goldman Sachs’s results here.
There has been positive sentiment among investors in the investment banking & brokerage segment, with share prices up 2.4% on average over the last month. Charles Schwab is up 2.6% during the same time and is heading into earnings with an average analyst price target of $118.67 (compared to the current share price of $104).
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