Schwab Hits 52-Week High: Is This the Right Time to Buy SCHW for 2026?

Charles Schwab SCHW touched a 52-week high of $102.05 during yesterday’s trading session as solid GDP numbers indicate a resilient economy and future earnings growth.
 
Over the past three months, SCHW stock has gained 6.8%, underperforming the industry but outperforming the Zacks Finance sector and the S&P 500. While it fared better than its close peer Robinhood Markets, Inc. HOOD, it underperformed LPL Financial Holdings Inc. LPLA.

Three Months' Price Performance

Does SCHW stock have more upside left after hitting a 52-week high? Let us figure it out.

Factors Likely to Drive Schwab Stock

Solid Advisory Solutions to Drive Revenues: Schwab’s efforts to boost its client base in advisory solutions will likely support top-line expansion. The acquisitions of TD Ameritrade, USAA’s Investment Management Company, Wasmer, Schroeder & Company, LLC and the buyout of Motif’s technology and intellectual property have strengthened the company’s position and helped diversify revenues.

Further, improving trade clarity and interest rate cuts will further boost investor optimism and liquidity in the market, leading to higher trading revenues. This will also aid LPL Financial and Robinhood.
 
Schwab’s total client assets recorded a five-year CAGR of 20.1% (ended 2024), primarily driven by the acquisitions completed during this period and market appreciation. The uptrend continued during the first nine months of 2025. As of Nov. 30, 2025, the company’s total client assets were $11.83 trillion.

Given higher client assets, Schwab’s total net revenues have witnessed a compound annual growth rate (CAGR) of 12.8% over the past five years (2019-2024), with managed investing solutions revenues recording a CAGR of 12.2%. The momentum continued for both metrics in the first nine months of 2025.

Notably, Schwab's plans to open 16 new branches and expand or relocate 25 existing ones will likely give the company a way to engage with clients during important financial moments, leading to higher client satisfaction, which, in turn, will result in clients consolidating more of their assets with Schwab.

Relatively Higher Interest Rates to Aid Net Interest Margin: While the Federal Reserve has reduced interest rates by 75 basis points (bps) this year, the rates are still higher than the near-zero levels in 2020 and 2021. This will likely support Schwab’s net interest margin (NIM) and net interest revenue (NIR) expansion.

Additionally, the company’s focus on repaying high-cost bank supplemental funding balances has been offering support. By September 2025-end, SCHW's supplemental funding balance declined 85% to $14.8 billion from the peak of $97.1 billion in May 2023.
 
As such, NIM increased to 2.12% in 2024 from 1.98% in 2023, 1.78% in 2022 and 1.45% in 2021. Schwab’s NIR witnessed a CAGR of 7% over the five years ended 2024. The momentum continued for both NII and NIM in the first nine months of 2025 as the company reduced supplemental funding.

The company expects NIM to keep expanding as funding costs come down, given the decline in supplement funding balance and relatively higher rates.

SCHW Rewards Shareholders: As of Sept. 30, 2025, Schwab’s cash and cash equivalents were $30.6 billion, and total debt (comprising long-term debt, Federal Home Loan Bank borrowings and other short-term borrowings) was $27.6 billion.

The company remains focused on maintaining a low-cost capital structure, which enables it to sustain capital distributions. Schwab targets a common dividend payout ratio of 20-30% of GAAP earnings.
 
In January 2025, it announced an 8% hike in quarterly dividend to 27 cents per share. In the past five years, the company raised dividend payouts four times. On the other hand, LPL Financial has just raised its dividend once during the same period, while Robinhood has never paid dividends.

While Schwab has an authorized share repurchase program, management intends to execute buybacks opportunistically rather than on a fixed schedule. As of Sept. 30, 2025, roughly $17.3 billion worth of authorization remained available.

Parting Thoughts on Schwab

Solid revenue growth, organic and inorganic expansion initiatives to diversify business, and a strong balance sheet will aid Schwab’s financials. Additionally, improving trade clarity and relatively higher interest rates are expected to support the company’s top line and NIM.

Over the past month, the Zacks Consensus Estimate for earnings per share of $4.82 and $5.60 for 2025 and 2026, respectively, has been revised upward. The projected figures imply growth of 21.4% for 2025 and 8.8% for 2026.

Estimate Revision Trend

However, Schwab has been experiencing a persistent rise in operating expenses. While total expenses declined in 2024 as the company undertook actions to streamline its operations post-TDA-integration, the metric witnessed a CAGR of 15.2% over the last five years (2019-2024). The uptrend continued in the first nine months of 2025. As the company invests in long-term growth, rising headcount, regulatory costs, and targeted marketing are expected to keep operating expenses elevated.

Thus, Schwab remains a cautious bet at the moment. Those who own it can continue holding it for long-term gains.

Schwab currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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