Charles Schwab Corp (SCHW): Today's Featured Financial Services Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

Charles Schwab ( SCHW) pushed the Financial Services industry lower today making it today's featured Financial Services laggard. The industry as a whole closed the day down 0.3%. By the end of trading, Charles Schwab fell 17 cents (-1.3%) to $13.10 on light volume. Throughout the day, 4.2 million shares of Charles Schwab exchanged hands as compared to its average daily volume of 9.4 million shares. The stock ranged in price between $13.08-$13.32 after having opened the day at $13.26 as compared to the previous trading day's close of $13.27. Other companies within the Financial Services industry that declined today were: US Global Investors ( GROW), down 6%, BGC Partners ( BGCP), down 4.8%, Federal Agricultural Mortgage ( AGM.A), down 4.7%, and Newtek Business Services ( NEWT), down 4.4%.

The Charles Schwab Corporation, through its subsidiaries, provides securities brokerage, banking, and related financial services to individuals and institutional clients. Charles Schwab has a market cap of $16.59 billion and is part of the financial sector. The company has a P/E ratio of 19.7, equal to the average financial services industry P/E ratio and above the S&P 500 P/E ratio of 17.7. Shares are up 17.9% year to date as of the close of trading on Friday. Currently there are four analysts that rate Charles Schwab a buy, one analyst rates it a sell, and nine rate it a hold.

TheStreet Ratings rates Charles Schwab as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, compelling growth in net income and reasonable valuation levels. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity, weak operating cash flow and poor profit margins.

On the positive front, Direct Markets Holdings ( MKTS), up 24.9%, Penson Worldwide ( PNSN), up 4.8%, First Marblehead Corporation ( FMD), up 3.5%, and Palmetto ( PLMT), up 2%, were all gainers within the financial services industry with Blackstone Group ( BX) being today's featured financial services industry leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the financial services industry could consider Financial Select Sector SPDR ( XLF) while those bearish on the financial services industry could consider Proshares Short Financials ( SEF).

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