NEW YORK (TheStreet) -- Charles Schwab (SCHW) gained more than 5% by late Tuesday following its third-quarter earnings report earlier in the day. For the third quarter ended Sept. 30, Schwab posted $290 million in net income, up 17% from the year-ago quarter, on revenue of $1.37 billion, a 15% year-on-year increase and the highest level in 13 years.
"Even with the continued headwind created by an interest rate environment that remains at historic lows, our third quarter revenues surpassed all our prior quarterly results save the extraordinary spike we experienced at the height of the Internet bubble," said CEO Walt Bettinger in a statement.
CFO Joe Martinetto restated a positive 2014 outlook for the company assuming continued economic recovery and client trading activity at current levels. Martinetto forecasts full-year 2013 revenue growth will outstrip expenses by 100 to 200 basis points, contributing to a pre-tax profit margin of at least 30% and earnings per share around 75 cents a share. For the nine months to September 30, earnings per share are 55 cents a share.
As of 3:10 p.m. New York time, shares had gained 5.9% to $23.30. So far, 24.04 million shares have changed hands, far exceeding the three-month average daily trading volume of 9.17 million.
TheStreet Ratings team rates Charles Schwab Corp as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:
"We rate Charles Schwab Corp (SCHW) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, expanding profit margins, good cash flow from operations and solid stock price performance. We feel these strengths outweigh the fact that the company has had sub par growth in net income."
- You can view the full analysis from the report here: SCHW Ratings Report
Written by Keris Alison Lahiff.