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Schwab (SCHW) Gains 7% as Net New Assets Rise Sequentially
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Shares of Charles Schwab (SCHW - Free Report) soared 7% following the release of its monthly activity report for November 2023. Also, a broader market rally on the back of the Federal Reserve’s signal of rate cuts in 2024 drove the stock higher.
The company’s core net new assets of $21.7 billion jumped 92% from the previous month’s levels but declined 34% from the prior-year month’s figures. Schwab’s total client assets in November 2023 were $8.18 trillion, up 7% from October 2023 levels and 12% from November 2022 levels.
Client assets receiving ongoing advisory services were $4.16 trillion, rising 7% from the prior month and 10% year over year.
Schwab’s average interest-earning assets of $439.1 billion in November are relatively stable from the October 2023 levels and down 17% year over year. Average margin balances were $61.5 billion, down 4% from the previous month’s level and 17% on a year-over-year basis. Average bank deposit account balances totaled $95 billion in November, down 3% from last month’s actuals and 27% from November 2022 levels.
The company opened 286,000 new brokerage accounts in November 2023, up 1% sequentially but down 6% from the year-earlier month’s figures.
Schwab’s active brokerage accounts totaled 34.7 million at the end of November 2023, which were relatively stable on a sequential basis and rose 3% from the year-ago month’s figures. Client banking accounts were 1.83 million, up 1% sequentially and 7% from the November 2022 figures. The number of workplace plan participant accounts is stable from the prior month’s level and up 8% year over year to 5.21 million.
Also, Schwab provided an update for 2023 revenues. Management expects lower transactional cash levels, subdued client trading volumes and muted securities lending activity to result in 2023 revenues to decline in the 9.5-10% range. Earlier, the company had provided for an 8-9% fall in the top line this year.
In the past six months, shares of Schwab have jumped 30.5% compared with the industry’s rise of 6.5%.
Interactive Brokers Group, Inc. (IBKR - Free Report) released the Electronic Brokerage segment’s performance metrics for November 2023. The segment deals with the clearance and settlement of trades for individual and institutional clients globally. It reported a decline in client Daily Average Revenue Trades (DARTs) on a sequential and year-over-year basis.
IBKR’s total client DARTs for the month were 1,898,000, declining 2% from the October 2023 levels and 3% year over year.
Another brokerage firm, LPL Financial (LPLA - Free Report) , will come out with its monthly activity report on Dec 18, 2023.
Currently, IBKR carries a Zacks Rank of 3, while LPLA has a Zacks Rank #5 (Strong Sell).
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Schwab (SCHW) Gains 7% as Net New Assets Rise Sequentially
Shares of Charles Schwab (SCHW - Free Report) soared 7% following the release of its monthly activity report for November 2023. Also, a broader market rally on the back of the Federal Reserve’s signal of rate cuts in 2024 drove the stock higher.
The company’s core net new assets of $21.7 billion jumped 92% from the previous month’s levels but declined 34% from the prior-year month’s figures. Schwab’s total client assets in November 2023 were $8.18 trillion, up 7% from October 2023 levels and 12% from November 2022 levels.
Client assets receiving ongoing advisory services were $4.16 trillion, rising 7% from the prior month and 10% year over year.
Schwab’s average interest-earning assets of $439.1 billion in November are relatively stable from the October 2023 levels and down 17% year over year. Average margin balances were $61.5 billion, down 4% from the previous month’s level and 17% on a year-over-year basis. Average bank deposit account balances totaled $95 billion in November, down 3% from last month’s actuals and 27% from November 2022 levels.
The company opened 286,000 new brokerage accounts in November 2023, up 1% sequentially but down 6% from the year-earlier month’s figures.
Schwab’s active brokerage accounts totaled 34.7 million at the end of November 2023, which were relatively stable on a sequential basis and rose 3% from the year-ago month’s figures. Client banking accounts were 1.83 million, up 1% sequentially and 7% from the November 2022 figures. The number of workplace plan participant accounts is stable from the prior month’s level and up 8% year over year to 5.21 million.
Also, Schwab provided an update for 2023 revenues. Management expects lower transactional cash levels, subdued client trading volumes and muted securities lending activity to result in 2023 revenues to decline in the 9.5-10% range. Earlier, the company had provided for an 8-9% fall in the top line this year.
In the past six months, shares of Schwab have jumped 30.5% compared with the industry’s rise of 6.5%.
Image Source: Zacks Investment Research
Currently, SCHW carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Interactive Brokers Group, Inc. (IBKR - Free Report) released the Electronic Brokerage segment’s performance metrics for November 2023. The segment deals with the clearance and settlement of trades for individual and institutional clients globally. It reported a decline in client Daily Average Revenue Trades (DARTs) on a sequential and year-over-year basis.
IBKR’s total client DARTs for the month were 1,898,000, declining 2% from the October 2023 levels and 3% year over year.
Another brokerage firm, LPL Financial (LPLA - Free Report) , will come out with its monthly activity report on Dec 18, 2023.
Currently, IBKR carries a Zacks Rank of 3, while LPLA has a Zacks Rank #5 (Strong Sell).