Have you been paying attention to shares of The Charles Schwab Corporation (SCHW)? Shares have been on the move with the stock up 5.2% over the past month. The stock hit a new 52-week high of $107.27 in the previous session. Charles Schwab has gained 7.3% since the start of the year compared to the 2.7% gain for the Zacks Finance sector and the 3.1% return for the Zacks Financial - Investment Bank industry.
What's Driving the Outperformance?
The stock has an impressive record of positive earnings surprises, having beaten the Zacks Consensus Estimate in each of the last four quarters. In its last earnings report on January 21, 2026, Charles Schwab reported EPS of $1.39 versus consensus estimate of $1.36.
For the current fiscal year, Charles Schwab is expected to post earnings of $5.77 per share on $26.4 in revenues. This represents a 18.48% change in EPS on a 10.37% change in revenues. For the next fiscal year, the company is expected to earn $6.7 per share on $28.79 in revenues. This represents a year-over-year change of 16.05% and 9.07%, respectively.
Valuation Metrics
While Charles Schwab has moved to its 52-week high in the recent past, investors need to be asking, what is next for the company? A key aspect of this question is taking a look at valuation metrics in order to determine if the company has run ahead of itself.
On this front, we can look at the Zacks Style Scores, as they provide investors with an additional way to sort through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. Investors should consider the style scores a valuable tool that can help you to pick the most appropriate Zacks Rank stocks based on their individual investment style.
Charles Schwab has a Value Score of B. The stock's Growth and Momentum Scores are B and B, respectively, giving the company a VGM Score of A.
In terms of its value breakdown, the stock currently trades at 18.6X current fiscal year EPS estimates, which is a premium to the peer industry average of 16.4X. On a trailing cash flow basis, the stock currently trades at 18X versus its peer group's average of 14.6X. Additionally, the stock has a PEG ratio of 0.87. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to look at the Zacks Rank for the stock, as this is even more important than the company's VGM Score. Fortunately, Charles Schwab currently has a Zacks Rank of #2 (Buy) thanks to rising earnings estimates.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Charles Schwab passes the test. Thus, it seems as though Charles Schwab shares could have potential in the weeks and months to come.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
The Charles Schwab Corporation (SCHW): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
Zacks Investment Research
