Schwab (SCHW) Up 1.2% as Total Client Assets Rise in July
Shares of Charles Schwab SCHW gained 1.2% since the release of its monthly activity report for July 2022 last week. Total client assets were $7.3 trillion, up 7% from June 2022 and down 4% from July 2021.
Further, core net new assets were $31.5 billion in the reported month. This compared with net new assets of $40.6 billion in June 2022 and $44.3 billion in July 2021. Client assets receiving ongoing advisory services were $3.74 trillion, up 6% from the prior month but down 1% year over year.
Schwab’s average interest-earning assets of $605.6 billion declined 1% from June 2022 but were up 11% year over year. Average margin balances were $72.2 billion, decreasing 6% from the previous month and 10% on a year-over-year basis. Average bank deposit account balances totaled $154.5 billion, relatively stable sequentially and rising 2% from July 2021.
Schwab opened 278,000 new brokerage accounts in July 2022, declining 9% sequentially and 31% from the year-earlier month.
Schwab’s active brokerage accounts totaled 33.9 million at the end of July 2022, stable on a sequential basis and up 5% from the year-ago month. Clients’ banking accounts were 1.68 million, up 1% sequentially and 6% from July 2021. The number of corporate retirement plan participants was on par with the prior-month level and up 5% year over year to 2.27 million.
Schwab’s inorganic growth efforts have reinforced its position as a leading brokerage player and are expected to be accretive to earnings. By offering commission-free trading, the company has witnessed a rise in client assets and brokerage accounts, which, in turn, is improving its market share.
So far this year, shares of Schwab have lost 9.8% compared with a 9.4% fall of the industry.
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Currently, Schwab carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Competitive Landscape
A couple of other brokerage firms that come out with monthly data are Interactive Brokers Group IBKR and LPL Financial Holdings Inc. LPLA.
Interactive Brokers’ Electronic Brokerage segment announced performance metrics for July 2022. The segment (dealing with the clearance and settlement of trades for individual and institutional clients globally) reported a decline in client Daily Average Revenue Trades (DARTs) both on a sequential and a year-over-year basis.
Total client DARTs for the month were 1,823,000, down 10% from the June 2022 level and 23% year over year. On an annualized basis, IBKR recorded Cleared Average DARTs per customer account of 210. The metric decreased 11% sequentially and 44% from the prior-year period.
LPL Financial is likely to come out with its monthly activity report in the coming days.
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The Charles Schwab Corporation (SCHW) : Free Stock Analysis Report
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