Charles Schwab SCHW announced monthly activity report for May 2020. The company recorded net new assets of $97.5 billion. This included inflows worth $79.9 billion related to the acquisition of USAA Investment Management Company. Core net assets were $17.6 billion, up 15% from the prior month and 2% year over year.
Further, total client assets were $4.01 trillion, up 6% from April 2020 and 14% from May 2019. Client assets receiving ongoing advisory services were $2.0515 trillion, up 5% from the prior month and 11% year over year.
Schwab’s average interest earning assets were $361.8 billion at the end of May 2020, up 2% from April 2020 and 37% from May 2019. The company had 1.25 million new brokerage accounts in the reported month. This included 1.1 million new brokerage accounts related to the acquisition of USAA Investment Management Company.
Schwab’s active brokerage accounts totaled 14.01 million at the end of May, up 9% sequentially and 17% from the year-ago month. Further, clients’ banking accounts were 1.4 million, rising 1% from April 2020 and 9% from May 2019. The number of retirement-plan participants grew 1% each from the prior-month level and year over year to 1.7 million.
Driven by heightened volatility resulting from the coronavirus outbreak, Schwab continues to record impressive growth in assets. Also, its initiatives to augment trading revenues remain impressive. Amid the Federal Reserve’s accommodative monetary policy, the company’s financials will likely get support from inorganic growth efforts.
Shares of the company have rallied 19.6% over the past three months, underperforming 30.1% rise recorded by the industry.
Currently, Schwab carries a Zacks Rank #2 (Buy). 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 May 2020. The company’s DARTs came in at 981,981, up 6% from the previous month and 244% year over year. Notably, derivatives comprised 26% of DARTs in the reported month.
Interactive Brokers Group’s IBKR Electronic Brokerage segment reported a substantial surge in DARTs in May 2020 on a year-over-year basis. Total client DARTs were 1,645,000, surging 84% from May 2019 but declining 4% from April 2020.
LPL Financial Holdings Inc. LPLA is expected to come out with monthly metrics report in the coming days.
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