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Charles Schwab Initiated as an “Outperform” at Wells Fargo (SCHW)

Brokerage house The Charles Schwab Corporation ( SCHW ) on Friday saw its coverage started with an "Outperform" rating by analysts at Wells Fargo.

The firm also set a valuation range of $22-23 for SCHW, which implies a 16% to 21% upside to the stock's Thursday closing price of $18.96.

A Wells Fargo analyst commented, "Following a challenging operating environment over the last few years, we believe fundamentals are poised to improve and we view SCHW as an attractive way for investors to play the financial market recovery and prospect for higher short-term interest rates. We are introducing 2011 and 2012 EPS estimates of $0.82 and $1.25, respectively. Our valuation range of $22-23 is based off an 18x multiple on our 2012 EPS estimate of $1.25."

Charles Schwab shares were mostly flat in premarket trading Friday.

The Bottom Line

Shares of Charles Schwab ( SCHW ) have a 1.27% dividend yield, based on last night's closing stock price of $18.96. The stock has technical support in the $17 price area. If the shares can firm up, we see overhead resistance around the $20-$21 price levels.

The Charles Schwab Corporation ( SCHW ) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.4 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks , as well as a detailed explanation of our ratings system here .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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