What Charles Schwab Has to Say about the Economy in 2018


Mar. 2 2018, Updated 4:55 p.m. ET

Favorable outlook

The Charles Schwab Corporation’s (SCHW) management reflected positive views of the overall outlook for 2018. In 2018, the new US tax law from December 2017 should positively impact the economy, resulting in growth. According to the company, the new law will have a positive impact on the stock markets because of investors’ positive expectations.

Moreover, Charles Schwab is expected to witness a decline in taxes, which would favorably impact the company’s business, as it can make deployments that could lead to long-term growth.

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What are the driving factors?

The US economy is expected to see favorable momentum moving forward on the back of a new US tax law, positive momentum in industries, and lower unemployment. Moreover, Charles Schwab is expected see strong growth in 2018, as it plans for more hiring while maintaining its focus on retention. Plus, the company plans to contribute to local communities and generate returns for shareholders.

Charles Schwab is also making favorable changes to its dividends, which could attract attention.

Charles Schwab’s dividend yield on an LTM (last-12-month) basis stood at 0.61%. Peers (XLF) LPL Financial Holdings (LPLA), Bank of New York Mellon Corporation (BK), and Morgan Stanley (MS) recorded 1.53%, 1.51%, and 1.61%, respectively.


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