Keefe, Bruyette & Woods raises Charles Schwab stock price target on NII beat

Published 17/10/2025, 12:52
Keefe, Bruyette & Woods raises Charles Schwab stock price target on NII beat

Investing.com - Keefe, Bruyette & Woods raised its price target on Charles Schwab Corp. (NYSE:SCHW) to $111.00 from $109.00 on Friday, while maintaining an Outperform rating following the company’s earnings beat and strong September cash growth.

Charles Schwab reported adjusted earnings per share of $1.31, exceeding KBW’s estimate of $1.27 and the consensus forecast of $1.24. The earnings beat was primarily driven by higher net interest income, which contributed $0.03 to the outperformance, and a lower tax rate adding another $0.03, slightly offset by higher expenses that reduced results by $0.02. With 12 analysts recently revising their earnings estimates upward and a favorable PEG ratio of 0.46, InvestingPro analysis suggests the stock may be trading at attractive valuations relative to its growth potential.

The financial services company posted full-quarter core net new assets of $137.5 billion, representing a 5.1% annualized growth rate. September alone saw $46.2 billion in net new assets, a 4.9% annualized rate, while sweep cash grew 4.6% month-over-month in September.

Charles Schwab repurchased approximately $2.7 billion of shares during the quarter, significantly exceeding KBW’s estimate of $1.4 billion and consensus expectations. The firm noted this demonstrates stronger capital return capacity than many analysts currently model.

KBW characterized the quarterly results as "a strong print" with better top-line performance primarily driven by higher net interest income on securities lending outperformance, while the company’s updated commentary for full-year and fourth-quarter 2025 was described as "conservative" by the research firm.

In other recent news, Charles Schwab Corp. reported its third-quarter 2025 results, prompting Goldman Sachs to raise its price target for the company to $114, maintaining a Buy rating. The investment bank also increased its earnings per share estimates for the coming years, citing strong client engagement and higher client transactional cash. Citizens reiterated its Market Outperform rating with a $110 price target, highlighting Schwab’s attractive valuation and robust earnings growth potential. The firm anticipates Schwab will exceed consensus estimates for quarterly earnings, forecasting $1.23 per share. Raymond James also increased its price target to $110, noting Schwab’s improved financial position and strategic reinvestment plans. Additionally, Charles Schwab launched Schwab Private Issuer Equity Services, a new equity management solution for late-stage private companies preparing for public offerings. This initiative aims to provide these companies with advanced equity management capabilities.

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