SC SCHW The Charles Schwab Corporation Loading... : Investor Sentiment and Bull/Bear Views

Cramer recommends Schwab despite AI-displacement and Meta Muse worries. The quarter was strong: record new assets, core net new assets up 38%, total client assets up 15%, 1.2 million new brokerage accounts, Wealth Advisory net flows up 55%, asset-management fees up 14%, trading revenue up 16%, and daily average trades up 44%. Management said deposits are not cash-sorting, clients move nearly $4 trillion monthly, and AI-using traders hold more cash. Buybacks are aggressive, $190 billion of low-yield securities will roll into higher yields, and the stock trades under 15x this year's and under 12x next year's estimates. Every time Wall Street counts Schwab out, it has been a buying opportunity.

The author holds Schwab and argues it is mispriced at under 15x forward earnings despite 17% revenue growth, 22% earnings growth and guidance for mid-teens growth in both plus NIM growth over the next year. The mechanism is a sticky higher-rate environment supporting net interest margin plus AI-enabled growth in daily active trades benefiting brokerages and platforms. Main stated risk is that investment banking wins may not be sustainable and some financials have questionable competitive moats.

The author states they like Charles Schwab for its margins, framing it as a preferred pick among brokers. They concede that Morgan Stanley and JPMorgan may be slightly better buys, but still favor SCHW on margin strength. No specific catalyst or time horizon is given, and the main risk is the acknowledged relative superiority of MS and JPM.