Charles Schwab saw total client assets jump 21% year over year in November 2017, hitting a record $3.32 trillion. In a press release, the San Francisco-based discount brokerage said that total assets increased 2% from October and that new brokerage accounts came in at 122,000 in November, up 31% from November 2016. This marks the twelfth consecutive month that new accounts were more than 100,000.
In October, The Charles Schwab Corporation (SCHW) reported that total client assets jumped 21% year over year and 2% from September, coming in at a record $3.26 trillion. Net new assets came in at $35.4 billion for October, while client assets receiving ongoing advisory services also set a record at $1.64 trillion, up 21% from a year ago and up 2% compared with September.
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Like other discount brokerages, Charles Schwab is benefiting from a stock market that has been high flying all year, prompting all sorts of investors to make trades. For the most recently reported third quarter, Schwab disclosed that it opened 216,000 new retail brokerage accounts, up 29% from a year ago, with total client assets increasing 17% to $3.18 trillion. Core net new assets jumped 72% to $51.6 billion. Earnings per share for the three months ending in September came in at $0.42, and revenue was $2.165 billion.
The strong showing on the part of Charles Schwab comes as Credit Suisse is bullish on the stock, initiating coverage earlier this month with an Outperform rating and a $55 price target. In a research report to clients, Credit Suisse analyst Craig Siegenthaler said that the discount brokerage's client-centric business strategy should enable it to generate "significant" value for its investors.
The analyst also pointed to rising interest rates and more money going into Charles Schwab's proprietary bank as reasons the stock should do well in the New Year. Credit Suisse expects Schwab to have "high organic growth" during the course of the next five years, which could result in EPS growth of 15% to 20%. Siegenthaler pointed to Schwab's guidance for a $200 million to $300 million increase from the next 25-basis-point increase in the Fed rate, with $200 million assuming no change to long-term rates and $300 million assuming a change.