Charles Schwab sees 75% increase in new assets for January

WESTLAKE, Texas - The Charles Schwab Corporation (NYSE:SCHW) reported significant growth in its January 2025 Monthly Activity Report. The financial services firm, currently valued at $149.32 billion by market capitalization, witnessed a substantial year-over-year increase in core net new assets, which surged by over 75%, amounting to $30.6 billion. This influx of new assets reflects both new and existing clients' contributions to the company's growth. According to InvestingPro data, the company has demonstrated strong momentum with a 10.21% return year-to-date.

As of the end of January, total client assets reached $10.33 trillion, marking a 21% increase from the same period last year and a 2% rise from December 2024. The company also saw an 18% uptick in new brokerage accounts compared to January of the previous year, with 433,000 new accounts opened. This growth aligns with Schwab's impressive 96.99% gross profit margin and projected 15% revenue growth for fiscal year 2025, as reported by InvestingPro.

Schwab's daily average trades in January climbed by 7% month-over-month to 7.37 million, indicating ongoing market engagement. However, transactional sweep cash experienced a decline of $19 billion from the previous month, ending at $399.6 billion, which aligns with the seasonal trend of clients reinvesting their cash at the beginning of the year.

Moreover, the company reduced its bank supplemental funding balances by $3.7 billion, finishing January at $46.2 billion outstanding.

The Charles Schwab Corporation (NYSE: SCHW) operates as a leading provider of various financial services, including wealth management, securities brokerage, banking, asset management, and financial advisory services. As of January 31, 2025, the company managed 36.7 million active brokerage accounts, 5.5 million workplace plan participant accounts, 2.0 million banking accounts, and client assets totaling $10.33 trillion.

The report's data is based on a press release statement and reflects the company's performance in the financial sector, offering insights into its asset management and client engagement for the start of 2025.

In other recent news, Charles Schwab Corporation has finalized a significant secondary offering of its common stock, resulting in a total purchase amount of $13.1 billion. This sale marks the exit of TD Group US Holdings LLC from its position in Charles Schwab. Analysts from Keefe, Bruyette & Woods have maintained an Outperform rating for Charles Schwab, following the news of TD Bank's decision to sell its remaining stake in the company.

Truist Securities also updated its financial model for Charles Schwab, leading to an increased price target and a reaffirmed positive outlook on the company's stock. This adjustment followed the news that TD Bank will be divesting its approximately 10% stake in Charles Schwab, with the latter participating in the transaction through a $1.5 billion buyback.

In addition to these developments, Wolfe Research reiterated its Outperform rating on Charles Schwab, with a steady price target of $100.00. This reaffirmation comes as TD Bank announced its decision to divest its entire stake of approximately 185 million shares, equating to 10.1% of Charles Schwab's shares.

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