On Tuesday, Charles Schwab Corp. (NYSE:), currently trading at $89.33 and commanding a market capitalization of $162 billion, received a bullish update from TD Cowen, as the firm’s analyst, Bill Katz, increased the 12-month price target on the company’s shares to $113 from the previous target of $95, while reiterating a Buy rating. Katz believes Charles Schwab is at the cusp of a new growth phase that could command a higher structural multiple. According to InvestingPro, the stock is currently fairly valued based on its proprietary Fair Value model.
Katz’s optimism is rooted in the company’s accelerating organic growth and effective execution of its balance sheet repair and repositioning strategy. Supporting this view, InvestingPro data shows the company achieved strong revenue growth of 10.86% and maintains a perfect Piotroski Score of 9, indicating excellent financial strength. He anticipates this will lead to an “optimization” phase that could significantly enhance the company’s return on tangible common shareholders’ equity (ROTCE), projecting it to approach 37% by the end of 2026.
The revised price target reflects Katz’s increased adjusted earnings per share (EPS) estimates for 2025-2026, which now place him above the consensus. The adjustment also incorporates outcomes from TD Cowen’s revised proprietary regression analysis. Katz’s update underscores his view that Charles Schwab remains a top selection within the retail brokerage/dealer (B/D) space and his overall preferred pick across his coverage universe.
Charles Schwab’s performance has been notable, as it stands as the best-performing stock year-to-date within TD Cowen’s coverage. Despite this strong performance, Katz sees potential for further gains in the stock’s future. His comments and the new price target suggest a continued positive outlook for Charles Schwab’s trajectory in the financial services industry.
In other recent news, The Charles Schwab Corporation reported a steady increase in client assets and account openings for April 2025, with net new assets totaling $2.7 billion. The company saw a 12% rise in total client assets compared to the previous year, reaching $9.89 trillion, and a 22% increase in new brokerage accounts from April 2024. Goldman Sachs upgraded Charles Schwab’s stock rating from Neutral to Buy, setting a price target of $100, citing strong earnings per share growth potential and a robust capital position. Keefe Bruyette & Woods also maintained an Outperform rating on the company’s stock, raising the price target to $93 following better-than-expected earnings results. Charles Schwab’s adjusted earnings per share came in at $1.04, surpassing estimates, largely due to increased revenues and a lower tax rate. TD Cowen analysts further adjusted their outlook, increasing the stock’s price target to $95, highlighting the company’s strong performance and management execution. Additionally, Charles Schwab declared regular quarterly dividends for both common and preferred stock, reflecting its ongoing commitment to shareholder value. These developments indicate a positive trajectory for the company’s financial health and market position.
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