Will This Analyst Action Hurt Charles Schwab (SCHW) Stock Today? (Update)

Update (9:38 a.m.): Updated with Thursday market open information.

NEW YORK (TheStreet) -- Barclays cut its estimates on Charles Schwab  (SCHW), set a $22 price target and holds an "underweight" rating. The firm notes net new assets came in lower than expected.

The stock was down 2.14% to $25.64 at 9:37 a.m. on Thursday.

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Separately, TheStreet Ratings team rates SCHWAB (CHARLES) CORP as a "buy" with a ratings score of A. TheStreet Ratings Team has this to say about their recommendation:

"We rate SCHWAB (CHARLES) 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, impressive record of earnings per share growth, compelling growth in net income, expanding profit margins and good cash flow from operations. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The revenue growth came in higher than the industry average of 5.1%. Since the same quarter one year prior, revenues rose by 13.7%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • SCHWAB (CHARLES) CORP reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, SCHWAB (CHARLES) CORP increased its bottom line by earning $0.78 versus $0.69 in the prior year. This year, the market expects an improvement in earnings ($0.97 versus $0.78).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Capital Markets industry. The net income increased by 58.3% when compared to the same quarter one year prior, rising from $206.00 million to $326.00 million.
  • 39.07% is the gross profit margin for SCHWAB (CHARLES) CORP which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 21.66% is above that of the industry average.
  • Net operating cash flow has significantly increased by 118.75% to $69.00 million when compared to the same quarter last year. Despite an increase in cash flow, SCHWAB (CHARLES) CORP's cash flow growth rate is still lower than the industry average growth rate of 162.25%.
  • You can view the full analysis from the report here: SCHW Ratings Report

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

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