TD Group to exit Charles Schwab stake, $1.5B buyback planned

WESTLAKE, Texas - The Charles Schwab Corporation (NYSE: NYSE:SCHW), a major player in financial services with a market capitalization of $152 billion, announced today that TD Group US Holdings LLC, an affiliate of The Toronto-Dominion Bank (TSX:TD), is planning to sell its entire 10.1% stake in the company. The divestiture will occur through a secondary public offering of 184.7 million shares of Charles Schwab’s common stock. According to InvestingPro data, Schwab’s stock has shown remarkable strength, gaining nearly 34% over the past six months and currently trading near its 52-week high.

Concurrently, Charles Schwab disclosed a share repurchase agreement with TD, contingent on the secondary offering’s completion. Under this agreement, Charles Schwab will buy back $1.5 billion of its nonvoting common stock from TD at the public offering price, minus the underwriting discount. The repurchase is expected to close immediately after the public offering concludes and will be funded by the company’s available cash. With an impressive track record of 37 consecutive years of dividend payments and a robust financial health score rated as GOOD by InvestingPro, Schwab demonstrates strong financial stability.

The buyback is part of the company’s ongoing share repurchase program, which, following this transaction, will have approximately $7.2 billion remaining for future repurchases. Throughout 2025, Charles Schwab anticipates continuing its strategy of opportunistic buybacks to align with its financial goals. For deeper insights into Schwab’s valuation and financial metrics, InvestingPro subscribers can access comprehensive research reports and 8 additional exclusive ProTips about the company’s current market position.

TD Securities and Goldman Sachs & Co. LLC are leading the secondary offering. Charles Schwab has registered the offering with the Securities and Exchange Commission (SEC), and interested investors are encouraged to read the prospectus and related documents filed with the SEC for more detailed information about the offering.

It is important to note that Charles Schwab will not receive any proceeds from the sale of the common stock in the secondary offering. After the completion of both the secondary offering and the repurchase transaction, TD will have sold all of its shares in Charles Schwab.

This announcement is provided based on a press release statement and does not constitute an offer to sell or a solicitation of an offer to buy any securities. Sales will not be made in any jurisdiction where such an offering would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

In other recent news, Trump Media and Technology Group (TMTG) announced plans to diversify into financial services, launching a new fintech brand, Truth.Fi. The company aims to invest up to $250 million of its cash reserves, exceeding $700 million, in this venture. This investment will be managed by Charles Schwab and may include separately managed accounts, exchange-traded funds, and crypto-related securities. TMTG plans to roll out Truth.Fi products and services in 2025, subject to necessary agreements and regulatory approvals.

In related developments, Charles Schwab Corporation has seen a series of upgrades from various analysts. Truist Securities raised the company’s stock target to $90, maintaining a Buy rating, following the company’s strong fourth-quarter 2024 performance. Similarly, Piper Sandler increased Charles Schwab’s stock target to $78, maintaining a Neutral rating, while Raymond (NSE:RYMD) James lifted the stock target to $88, retaining an Outperform rating. These upgrades follow strong earnings and revenue results from Charles Schwab, with future projections prompting analysts to express confidence in the company’s financial trajectory.

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