SCHW · sample dossier
The Charles Schwab Corporation
64/100
OutdatedGenerated Oct 10, 2026 · 10:00 AM UTC · 3 hours ago
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EquityThe Charles Schwab CorporationXNYS
Decision context
HOLD
70% convictionThe latest quarter is more than 100 days old, so this stays a Hold.
A mixed picture — no strong reason to buy or sell right now.
The stock trades 49.7% below our estimate.
Current price
$96.70
Estimated value range
$76.05 – $191.78
Gap vs AlphaDog estimate
+49.7%
Narrow evidence — range rests on a single usable method.
The stock trades at a discount, but execution uncertainties suggest waiting for a clearer catalyst.
Market context
Price
Price when available
Pick how far back the chart looks
1 month
-9.9%
3 months
-5.5%
6 months
+2.0%
1 year
+3.1%
Financial trajectory
Executive summary & thesis
The Charles Schwab Corporation is a financial services provider with a market capitalization of $167.23B, trading at a price-to-earnings ratio of 17.61 and generating $6.20 in free cash flow per share.
- EPS grew 42.6% YoY in the latest quarter, driven by operating leverage and 20.9% revenue growth.
- Shares trade at a P/E multiple of 17.61, below peer valuations of 34.9 for IBKR and 26.3 for LPLA.
- High cash conversion produces $6.20 in free cash flow per share alongside a 38.8% net margin.
- Financial leverage is elevated with a debt-to-equity ratio of 1.51 against a modest ROA of 2.1%.
- Stock momentum is negative with a 1-month return of -9.9% and price trading below MA50 and MA200.
- Trailing 3-month net insider transactions resulted in -$5.35M USD of net sales despite option exercise activity.
Things to keep in mind
- 1P/E 17.6xView source
- 2Debt/Equity 1.51View source
- 3Financial leverage is elevated with a debt-to-equity ratio of 1.51 against a modest ROA of 2.1%.View source
What to watch next
Factor profile
Growth-led profile
| Factor | Score |
|---|---|
| Quality | 77 out of 100 (Strong). Business health — profits, returns, and consistency. Higher means a more durable company. |
| Growth | 81 out of 100 (Elite). How fast sales and earnings are rising. Higher means the business is expanding faster. |
| Value | 67 out of 100 (Neutral). How cheap the stock looks for what you get. Higher means a more attractive price. |
| Safety | 55 out of 100 (Neutral). Balance-sheet cushion and fewer red flags. Higher means less risk of a nasty surprise. |
| Momentum | 26 out of 100 (Weak). Recent share-price trend. Higher means buyers have been in control lately. |
Another way to look at it
A calmer look at both sides of the SCHW story
The consensus 'Buy' verdict and bullish debate outcome dangerously dismiss severe balance-sheet leverage by fixating on backward-looking operating growth.
Schwab's modest 2.1% ROA combined with an elevated debt-to-equity ratio of 1.51 demonstrates that its profitability is heavily financialized rather than driven by superior asset efficiency. Furthermore, the market is actively rejecting this earnings momentum, evidenced by a -9.9% one-month return that has pushed the stock below both its 50-day and 200-day moving averages. Insiders have confirmed this hesitation by unloading -$5.35M in net sales over the past three months instead of accumulating shares at a supposed discount. Extrapolating a single quarter's 42.6% EPS surge into an enduring moat ignores how quickly rate cycles can compress Schwab's 38.8% net margin on a 3.8 Price-to-Book valuation base.
Balance-sheet leverage risk is obscured by platform margins: an ROA of 2.1% against a debt-to-equity ratio of 1.51 means even a minor asset yield contraction severely threatens equity returns.
Unresolved cash flow discrepancies between the synthesis report claiming $6.20 FCF per share and the debate pointing out unavailable EV/EBITDA and cash generation metrics.
Insider divergence from the bull thesis, highlighted by -$5.35M in net sales across nine transactions over the trailing three months while the stock broke technical support.
Extrapolating peak operating leverage
assuming that 42.6% YoY EPS growth and 20.9% revenue growth can persist without mean-reverting toward normalized industry levels.
Treating the 17.61 P/E ratio as an unvarnished bargain relative to peers (IBKR at 34.9, LPLA at 26.3) while ignoring Schwab's elevated 3.8 Price-to-Book ratio.
Brushing aside extreme negative technical momentum (1-month return of -9.9% placing it in the 0th percentile of peers) as noise rather than institutional distribution.
Revenue growth YoY decelerates below 20.9%.
Net margin compresses below 38.8%.
Cash after investing
Cash-flow details are thin for SCHW — check the Financials tab when you can.
- Revenue growth YoY decelerates below 20.9%.
- Net margin compresses below 38.8%.
- Debt/Equity improves from 1.51 or refinancing risk falls
For learning and research only — not investment advice. AlphaDog doesn’t hold stocks and isn’t your financial advisor.
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