SCHWAB CHARLES CORP (SCHW) Stock Analysis

Analysis from 10-Q filed 2025-11-07. Data as of Q4 2025.

Overall Grade: F (Concerning)

SCHWAB CHARLES CORP faces challenges in financial performance that warrant careful analysis.

Metric	Value	Context
ROIC	N/A	Below expectations
FCF Margin	36.6%	Strong cash generation
Debt/Equity	0.5x	Conservative leverage

Investment Thesis: Healthy free cash flow margin of 36.6% provides financial flexibility for growth and shareholder returns.

Explore SCHWAB CHARLES CORP: Earnings History | Filing Intelligence | ROIC Analysis

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Profitability: SCHWAB CHARLES CORP earns N/A ROIC

SCHWAB CHARLES CORP's trailing-twelve-month ROIC of N/A (sector median: 9.2%). Source: 10-Q filed 2025-11-07.

Metric	SCHW	Rating	Context
Return on Invested Capital (ROIC)	N/A	Red flag	Below sector median of 9.2%
Return on Equity (ROE)	17.1%	Good	Efficient use of shareholder equity

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Cash Flow: SCHWAB CHARLES CORP generates $8.8B FCF at 36.6% margin, positive NaN/8 quarters

SCHWAB CHARLES CORP generated $8.8B in free cash flow (TTM), a 36.6% FCF margin, a margin that ranks Top 25% in Financials. Operating cash flow exceeds net income by 1.1x, indicating high earnings quality. FCF was positive in N/A of the last 8 quarters. Source: 10-Q filed 2025-11-07.

Metric	SCHW	Rating	Context
Free Cash Flow Margin	36.6%	Excellent	Excellent cash conversion
Free Cash Flow (TTM)	$8.8B	Good	Positive cash generation
OCF/Net Income	1.1x	Excellent	High earnings quality
FCF Consistency (8Q)	N/A	Warning	Variable cash flow

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Balance Sheet: SCHWAB CHARLES CORP at 0.5x leverage

SCHWAB CHARLES CORP's debt-to-equity ratio of 0.5x reflects moderate leverage. Net cash position of $45.6B provides financial flexibility. Source: 10-Q filed 2025-11-07.

Metric	SCHW	Rating	Context
Debt to Equity	0.5x	Good	Conservative capital structure
Net Cash Position	$45.6B	Excellent	Net cash positive

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Valuation: SCHWAB CHARLES CORP trades at 21.3x earnings

SCHWAB CHARLES CORP trades at a P/E of 21.3x. Free cash flow yield of 4.9% reflects market expectations for growth.

Metric	SCHW	Rating	Context
P/E Ratio	21.3x	Adequate	Premium valuation
EV/Sales	6.0x	Adequate	Growth premium priced in
FCF Yield	4.9%	Good	Lower cash yield
Dividend Yield	1.1%	Adequate	Growth focus over income

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Capital Allocation: SCHWAB CHARLES CORP returns 1.1% shareholder yield

SCHWAB CHARLES CORP's total shareholder yield is 1.1% (dividends 1.1% + buybacks). Source: 10-Q filed 2025-11-07.

Metric	SCHW	Rating	Context
Total Shareholder Yield	1.1%	Adequate	Dividend + buyback yield combined
Total Capital Returned (TTM)	$2.3B	Good	Dividends + buybacks returned to shareholders

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Sector Rankings

Metric	Value	Percentile	vs Median
Free Cash Flow Margin	36.6%	Top 25%	1.7x above
Return on Equity (ROE)	17.1%	Top 25%	1.6x above
P/E Ratio	21.3x	N/A	-

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Financial Scorecard

Metric	SCHW	Rating	Sector Context
Free Cash Flow Margin	36.6%	Excellent	Top 25% of sector (median: 21.3%)
Debt to Equity Ratio	48.8%	Good	Moderate leverage
P/E Ratio (Price-to-Earnings)	21.3x	Adequate	Fair value
Free Cash Flow Yield	4.9%	Adequate	Moderate yield

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Frequently Asked Questions

Q: What is SCHWAB CHARLES CORP's Return on Invested Capital (ROIC)?

SCHWAB CHARLES CORP (SCHW) has a trailing twelve-month Return on Invested Capital (ROIC) of N/A. This compares below the sector median of 9.2%. An ROIC below 8% suggests the company may be destroying shareholder value.

Q: What is SCHWAB CHARLES CORP's Free Cash Flow Margin?

SCHWAB CHARLES CORP (SCHW) has a free cash flow margin of 36.6%, generating $8.8 billion in free cash flow over the trailing twelve months. A FCF margin above 20% indicates excellent cash conversion and a high-quality business model.

Q: Is SCHWAB CHARLES CORP stock overvalued or undervalued?

SCHWAB CHARLES CORP (SCHW) trades at a P/E ratio of 21.3x, which is above the sector median of N/A. The EV/Sales multiple is 6.0x. Free cash flow yield is 4.9%, which is in line with market averages.

Q: Does SCHWAB CHARLES CORP pay a dividend?

SCHWAB CHARLES CORP (SCHW) currently pays a dividend yield of 1.1%. Including share buybacks, the total shareholder yield is 1.1%. The relatively low yield suggests the company prioritizes growth reinvestment over income distribution.

Q: What is SCHWAB CHARLES CORP's revenue and earnings growth?

SCHWAB CHARLES CORP (SCHW) grew revenue by 22.0% year-over-year. Earnings per share increased by 55.5% compared to the prior year. Double-digit revenue growth indicates strong demand and market share gains.

Q: Is SCHWAB CHARLES CORP buying back stock?

SCHWAB CHARLES CORP (SCHW) repurchased $7.3 billion of stock over the trailing twelve months. This represents a buyback yield of 4.1%.

Q: How does SCHWAB CHARLES CORP compare to competitors in Financials?

Compared to other companies in Financials, SCHWAB CHARLES CORP (SCHW) shows: ROIC of N/A is below the sector median of 9.2% (NaNx median). FCF margin of 36.6% exceeds the sector median of 21.3% (Top 21% of sector). These rankings are based on MetricDuck's analysis of all Financials companies with available SEC filings.

Q: What warning signs should I watch for with SCHWAB CHARLES CORP?

SCHWAB CHARLES CORP (SCHW) shows no major financial warning signs based on current metrics. However, investors should always monitor: 1) Margin compression trends, 2) Cash flow consistency, 3) Debt levels relative to cash generation, and 4) Changes in competitive positioning.

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Data Source: Data sourced from 10-Q filed 2025-11-07. TTM metrics as of Q4 2025.

Methodology: Financial metrics calculated from SEC 10-K and 10-Q filings using standardized formulas. Sector comparisons use peer group based on SIC code.

Scope: This analysis covers SEC filing fundamentals — profitability, cash flow, balance sheet, and valuation metrics. For analyst estimates and price targets, consult sell-side research.

This analysis is for informational purposes only and does not constitute investment advice.