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Schwab's (SCHW) April Metrics Solid on Coronavirus Volatility

Zacks Equity Research

Charles Schwab SCHW reported monthly activity report for April 2020. The company recorded net new assets of $15.3 billion, down 45% from the previous month. In the prior-year month, net new assets were an outflow of $0.3 billion.

Total client assets were $3.78 trillion, up 8% from March 2020 and 3% year over year. Client assets receiving ongoing advisory services were $1.96 trillion, up 7% from the prior month and 2% year over year.

Schwab’s average interest earning assets were $353 billion at the end of April 2020, up 11% from March 2020 and 31% from April 2019. The company opened 201,000 new brokerage accounts in the reported month, down 29% sequentially but up 37% year on year.

Schwab’s active brokerage accounts totaled 12.9 million at the end of April, up 1% sequentially and 8% from the year-ago month. Further, clients’ banking accounts were 1.4 million, rising 1% from March 2020 and 10% from April 2019. The number of retirement-plan participants declined 1% from the prior-month level but remained almost stable year on year at 1.7 million.

Driven by continued volatility resulting from the coronavirus outbreak, Schwab reported impressive growth in assets in April 2020. Notably, its initiatives to augment trading revenues remain impressive. Amid the Federal Reserve’s accommodative policy stance, the company’s top line is expected to get support from its inorganic growth efforts.

Shares of the company have lost 29.8% so far this year compared with 25.5% decline recorded by the industry.




Currently, Schwab carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance & Upcoming Releases of Other Brokers

E*TRADE Financial ETFC reported a rise in Daily Average Revenue Trades (DARTs) for April 2020. The company’s DARTs came in at 927,671, up 3% from the previous month and more than 200% year over year. Notably, derivatives comprised 25% of DARTs in the reported month.

Interactive Brokers Group’s IBKR Electronic Brokerage segment reported a substantial surge in DARTs in April 2020 on a year-over-year basis. Total client DARTs were 1,720,000, surging 121% from April 2019 but declining 12% from March 2020.

LPL Financial Holdings Inc. LPLA is expected to report monthly metrics information in the coming days.

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Interactive Brokers Group, Inc. (IBKR) : Free Stock Analysis Report
 
ETRADE Financial Corporation (ETFC) : Free Stock Analysis Report
 
The Charles Schwab Corporation (SCHW) : Free Stock Analysis Report
 
LPL Financial Holdings Inc. (LPLA) : Free Stock Analysis Report
 
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