The Charles Schwab Corporation (SCHW): A Bull Case Theory

We came crossed a bullish thesis connected The Charles Schwab Corporation connected The Diversified Fins Analyst’s Substack by Collin Cook. In this article, we volition summarize the bulls’ thesis connected SCHW. The Charles Schwab Corporation's stock was trading astatine $92.73 arsenic of November 28th. SCHW’s trailing and guardant P/E were 21.72 and 16.56 respectively according to Yahoo Finance.

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The Charles Schwab Corporation, unneurotic with its subsidiaries, operates as a savings and indebtedness holding institution that provides wealthiness management, securities brokerage, banking, plus management, custody, and fiscal advisory services successful the United States and internationally. SCHW delivered a standout quarter, with results reinforcing the spot of its halfway franchise and validating the ongoing betterment successful cardinal profitability drivers.

Total nett gross reached a grounds $6.1B, up 5% sequentially and 27% twelvemonth implicit year, driven chiefly by an 8% Q/Q emergence successful nett involvement income and dependable maturation crossed trading and plus absorption fees. Adjusted operating expenses roseate lone 2% Q/Q, supporting a 51.3% pre-tax borderline and grounds adjusted EPS of $1.31, up 15% Q/Q and 70% Y/Y. Performance exceeded expectations, with gross and EPS beating statement by 2% and 5%, respectively.

Core operating trends remained robust: NIM expanded 21 bps to 2.86%, lawsuit assets reached a grounds $11.6T, and plus absorption balances grew 9% Q/Q. Net caller assets of $138B represented a meaningful acceleration successful integrated growth, supported by improving Ameritrade lawsuit flows. Although trading enactment softened somewhat Q/Q, it remained significantly higher twelvemonth implicit year, and the steadfast continued attracting younger households, strengthening semipermanent demographic tailwinds. Management reiterated assurance successful further NIM enlargement and highlighted that supplemental backing has been reduced to wrong the people range, lowering backing costs and enabling redeployment into higher-yielding securities.

Schwab present expects full-year EPS to finish roughly 2% above its anterior outlook, implying ~$4.75. Capital instrumentality remained strong, with $2.7B successful buybacks during the 4th and leverage ratios comfortably supra targets. Plans to motorboat spot crypto trading successful 1H26 and continued concern successful subdivision enlargement further enactment strategical positioning. Overall, the 4th reinforced Schwab’s net momentum, improved equilibrium expanse flexibility, and a wide way toward sustained NNA maturation and borderline expansion.

Previously we covered a bullish thesis connected Morningstar, Inc. (MORN) by Flyover Stocks successful May 2025, which highlighted its beardown moat, heavy fiscal information capabilities, and founder-led stability. The company’s banal terms has depreciated astir by 29.35% since our coverage. This is due to the fact that the thesis didn’t play retired successful the abbreviated term. The thesis inactive stands arsenic request for transparent information remains durable. Collin Cook shares a akin presumption but emphasizes Schwab’s operating momentum.