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Charles Schwab (Charles Schwab) ROE % : 13.07% (As of Mar. 2024)


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What is Charles Schwab ROE %?

ROE % is calculated as Net Income divided by its average Total Stockholders Equity over a certain period of time. Charles Schwab's annualized net income for the quarter that ended in Mar. 2024 was $5,448 Mil. Charles Schwab's average Total Stockholders Equity over the quarter that ended in Mar. 2024 was $41,685 Mil. Therefore, Charles Schwab's annualized ROE % for the quarter that ended in Mar. 2024 was 13.07%.

The historical rank and industry rank for Charles Schwab's ROE % or its related term are showing as below:

SCHW' s ROE % Range Over the Past 10 Years
Min: 8.48   Med: 12.87   Max: 17.9
Current: 12.4

During the past 13 years, Charles Schwab's highest ROE % was 17.90%. The lowest was 8.48%. And the median was 12.87%.

SCHW's ROE % is ranked better than
70.91% of 770 companies
in the Capital Markets industry
Industry Median: 5.295 vs SCHW: 12.40

Charles Schwab ROE % Historical Data

The historical data trend for Charles Schwab's ROE % can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

Charles Schwab ROE % Chart

Charles Schwab Annual Data
Trend Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21 Dec22 Dec23
ROE %
Get a 7-Day Free Trial Premium Member Only Premium Member Only 17.47 8.48 10.43 15.47 13.07

Charles Schwab Quarterly Data
Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22 Dec22 Mar23 Jun23 Sep23 Dec23 Mar24
ROE % Get a 7-Day Free Trial Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 17.58 14.09 12.01 10.62 13.07

Competitive Comparison of Charles Schwab's ROE %

For the Capital Markets subindustry, Charles Schwab's ROE %, along with its competitors' market caps and ROE % data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.


Charles Schwab's ROE % Distribution in the Capital Markets Industry

For the Capital Markets industry and Financial Services sector, Charles Schwab's ROE % distribution charts can be found below:

* The bar in red indicates where Charles Schwab's ROE % falls into.



Charles Schwab ROE % Calculation

Charles Schwab's annualized ROE % for the fiscal year that ended in Dec. 2023 is calculated as

ROE %=Net Income (A: Dec. 2023 )/( (Total Stockholders Equity (A: Dec. 2022 )+Total Stockholders Equity (A: Dec. 2023 ))/ count )
=5067/( (36608+40958)/ 2 )
=5067/38783
=13.07 %

Charles Schwab's annualized ROE % for the quarter that ended in Mar. 2024 is calculated as

ROE %=Net Income (Q: Mar. 2024 )/( (Total Stockholders Equity (Q: Dec. 2023 )+Total Stockholders Equity (Q: Mar. 2024 ))/ count )
=5448/( (40958+42412)/ 2 )
=5448/41685
=13.07 %

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

In the calculation of annual ROE %, the net income of the last fiscal year and the average total shareholder equity over the fiscal year are used. In calculating the quarterly data, the net income data used here is four times the quarterly (Mar. 2024) net income data. ROE % is displayed in the 30-year financial page.


Charles Schwab  (NYSE:SCHW) ROE % Explanation

ROE % measures the rate of return on the ownership interest (shareholder's equity) of the common stock owners. It measures a firm's efficiency at generating profits from every unit of shareholders' equity (also known as net assets or assets minus liabilities). ROE % shows how well a company uses investment funds to generate earnings growth. ROE %s between 15% and 20% are considered desirable.

The factors that affect a company's ROE % can be illustrated with the three-step DuPont Analysis:

ROE %(Q: Mar. 2024 )
=Net Income/Total Stockholders Equity
=5448/41685
=(Net Income / Revenue )*(Revenue / Total Assets)*(Total Assets / Total Stockholders Equity)
=(5448 / 18960)*(18960 / 480981)*(480981 / 41685)
=Net Margin %*Asset Turnover*Equity Multiplier
=28.73 %*0.0394*11.5385
=ROA %*Equity Multiplier
=1.13 %*11.5385
=13.07 %

With this breakdown, it is clear that if a company grows its Net Profit Margin, its Asset Turnover, or its Leverage, it can grow its ROE %.

The factors that affect a company's ROE % can also be illustrated with the five-step DuPont Analysis:

ROE %(Q: Mar. 2024 )
=Net Income/Total Stockholders Equity
=5448/41685
=(Net Income / Pre-Tax Income) * (Pre-Tax Income / Revenue) * (Revenue / Total Assets) * (Total Assets / Total Stockholders Equity)
= (5448 / 7192) * (7192 / 18960) * (18960 / 480981) * (480981 / 41685)
= Tax Burden * Pretax Margin % * Asset Turnover * Equity Multiplier
= 0.7575 * 37.93 % * 0.0394 * 11.5385
=13.07 %

Note: The net income data used here is four times the quarterly (Mar. 2024) net income data. The Revenue data used here is four times the quarterly (Mar. 2024) revenue data. The same rule applies to Pre-Tax Income and Operating Income.
* In the five-step DuPont Analysis, Operating Income is only available for non-financial companies. Thus, for Insurance companies, we use EBIT as a substitution of Operating Income. For Banks, both Operating Income and EBIT is unavailable. Thus we combined Interest Burden and Operating Margin % into Pretax Margin %, and the DuPont Analysis is divided into four components instead.

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.


Be Aware

Net Income is used.

Because a company can increase its ROE % by having more financial leverage, it is important to watch the equity multiplier when investing in high ROE % companies. Like ROA %, ROE % is calculated with only 12 months data. Fluctuations in company's earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective.

Asset light businesses require very few assets to generate very high earnings. Their ROE %s can be extremely high.


Charles Schwab ROE % Related Terms

Thank you for viewing the detailed overview of Charles Schwab's ROE % provided by GuruFocus.com. Please click on the following links to see related term pages.


Charles Schwab (Charles Schwab) Business Description

Address
3000 Schwab Way, Westlake, TX, USA, 76262
Charles Schwab operates in brokerage, wealth management, banking, and asset-management businesses. The company runs a large network of brick-and-mortar brokerage branch offices, a well-established online investing website, and has mobile trading capabilities. It also operates a bank and a proprietary asset management business and offers services to independent investment advisors. The company is among the largest firms in the investment business, with over $7 trillion of client assets at the end of December 2022. Nearly all of its revenue is from the United States.
Executives
Carolyn Schwab-pomerantz director 3000 SCHWAB WAY, WESTLAKE TX 76262
Morgan Peter J. Iii officer: General Counsel 211 MAIN STREET, SAN FRANCISCO CA 94105
Peter B. Crawford officer: CFO 211 MAIN STREET, SAN FRANCISCO CA 94105
Charles R. Schwab director, officer: Co-Chairman PO BOX 2226, PALM BEACH FL 33480
Paula A Sneed director THREE LAKES DRIVE, NORTHFIELD IL 60093
Charles A. Ruffel director 3000 SCHWAB WAY, WESTLAKE TX 76262
Arun Sarin director C/O SAFEWAY INC., 5918 STONERIDGE MALL ROAD, PLEASANTON CA 94588
Joan Dea director 229 BRANNAN ST. #18G, SAN FRANCISCO CA 94107
Brian M Levitt director C/O DOMTAR CORPORATION, 234 KINGSLEY PARK DRIVE, FORT MILL SC 29715
Marianne Catherine Brown director 4094 TIMUQUANA ROAD, JACKSONVILLE FL 33210-8571
Richard A Wurster officer: President 3000 SCHWAB WAY, WESTLAKE TX 76262
Bernard J. Clark officer: MD, Head of Adivsor Services C/O THE CHARLES SCHWAB CORPORATION, 211 MAIN STREET, SAN FRANCISCO CA 94105
Gerri Martin-flickinger director C/O TABLEAU SOFTWARE, INC., 1621 N 34TH ST, SEATTLE WA 98103
Mark A Goldfarb director C/O THE CHARLES SCHWAB CORPORATION, 211 MAIN STREET, SAN FRANCISCO CA 94105
Stephen A Ellis director C/O THE CHARLES SCHWAB CORPORATION, 211 MAIN STREET, SAN FRANCISCO CA 94105