Charles Schwab Stock: Trading Up in a Down Market

Key Points

• Charles Schwab grew total assets under management (AUM) to a staggering $10.28 trillion in February 2025.
• Schwab launched 24-hour, 5-days-a-week trading on S&P 500 and NASDAQ 100 stocks and select ETFs for all its customers.
• Schwab stock has remained resilient during the market selloff, outperforming the benchmark indices in 2025.

The Charles Schwab Co. NYSE: SCHW has evolved and grown from a tiny retail discount stockbroker on Wall Street in the financial services sector that gained prominence for its flat commission trades in the early 1990s to a retail financial services powerhouse with $10.28 trillion in assets in 2025. Despite the rough market backdrop plagued by recession risk and tariff fears, with the S&P 500 index trading down 5.2%, Schwab’s stock is trading up 5.1% year-to-date (YTD) as of March 28, 2025.

It's a beacon of resilience in a sinking market that's even outperforming the largest bank in the country, JPMorgan Chase & Co. NYSE: JPM, trading up 1.3% YTD as of March 29, 2025. Here are some of the reasons why it's fading for a potential breakout.

Solid Winter Business Update Proves Its Resilience

Schwab reported a winter update for its fourth quarter of 2024, adding $115 billion in core net new assets for a total of $367 billion in 2024, up 4.3% on an annualized basis. The company reported earnings per share (EPS) of $1.01 vs consensus estimates of 91 cents, beating by 10 cents. Revenue growth was exceptional, rising 19.5% year-over-year (YOY) to $5.33 billion, compared to consensus analysts' estimates of $5.20 billion.

At the time of the winter update, net client assets grew to $10.10 billion.

Expanded 24-hour Trading Available to All Customers

On February 12, 2025, Schwab rolled out 24-hour trading on select stocks to all customers. While the extended post-market trading ends at 8:00 p.m. EST, customers can trade an expanded list of S&P 500 and Nasdaq-100 stocks and hundreds of ETFs 24 hours a day and five days a week through its ThinkorSwim trading platform. 

This came after several successful small-scale pilots tested the 24-hour trading, which concluded at the end of 2024.

This is added to its monthly trading volume. However, the 24-hour equities market trading volume is relatively small and less liquid, even for popular stocks in the most liquid benchmark index like the S&P 500.

Schwab managing director and head of trading services James Kostulias commented, “What we saw during the pilot period was that trading behavior more or less mirrored what we typically see during standard market hours. Activity was the most pronounced at the beginning and end of the overnight session, similar to the behavior we see during market open and close."

February Monthly Metrics Update Doesn’t Disappoint

On March 14, 2025, Schwab provided its prior-month metrics. February's daily average trading volume rose 1% YOY to 7.45 million shares. Core net new assets rose nearly 44% YOY to $48.04 billion. New brokerage accounts opened in February reached 362,000, and transactional sweep cash at the end of the month totaled $404.3 billion.

Valuation Metrics on Schwab Stock Show It's Still Pricey

SCHW is trading around its 5-year price-to-earnings ratio (PE) of 26.02, but its forward P/E of 18.43 is below its 5-year average of 20.62. However, the industry average P/E is 14.6, and the average price-sales (P/S) ratio is 2.18 compared to 7.28. Based on these financial metrics, it's no secret that SCHW is a solid company. The stock has a 1.31% annual dividend.

There’s a premium on a stock that is holding up so resiliently in a weak market.

TD Bank Sells the Rest of Its 10.1% Stake in Charles Schwab

On February 12, 2025, the Toronto-Dominion Bank NYSE: TD sold the rest of its remaining shares in Charles Schwab stock at $79.25 per share. Schwab had acquired the TD Ameritrade retail brokerage business, which also included the ThinkorSwim trading platform from TD Bank so that they could focus on their core banking business, not retail trading. The deal took nearly a year to close after its announcement on November 25, 2019, due to an antitrust probe since the combination would have an 11% market share of the retail financial services market.

The deal was completed in October 2020 in a $26 billion all-stock transaction. TD Bank sold its remaining stake of 165.44 million shares in a registered private offering at $79.25 per share, and Schwab bought back 19.24 million shares for $1.5 billion.

SCHW Stock Found Solid Support at the 200-Week Moving Average

The broader stock market indexes, like the S&P 500 and NASDAQ 100 indexes, reversed recent bounces to fall back under their respective 200-day moving averages. SCHW stock dipped briefly in the prior weeks to test the 200-week moving average at $70.75 and rebounded sharply off that level and above the weekly anchored VWAP support at $75.81.

In the larger context, SCHW stock is still in the weekly triangle pattern. It bounced back above the weekly ascending lower trendline support at $76.70. The breakout occurs if SCHW can rise above the $84.04 upper trendline resistance.