Credit Suisse upgrades SCHW, says stock has ‘overshot to the downside’
Charles Schwab shares are attractive following the fallout from Silicon Valley Bank and Signature Bank , according to Credit Suisse. Analyst Bill Katz upgraded the brokerage to outperform from neutral, saying it’s time for investors to “take advantage of the sharp share price decline.” The stock is down nearly 32% this year. “While we may not have caught the shares at the extreme fear level, we see attractive risk/reward, nonetheless,” Katz wrote in a Wednesday note. Charles Schwab shares dropped 24% last week along with regional banks as traders worried that they would have to sell their bond holdings early at large losses to cover deposit withdrawals, like Silicon Valley Bank. However, CEO Walt Bettinger in an interview with CNBC’s Sara Eisen on ” The Exchange ” that Charles Schwab is still experiencing “significant” asset inflows. Charles Schwab shares rose 9% on Tuesday, after falling more than 11% Monday, as part of a broader rebound in finance stocks. It’s down 3% this week. SCHW 5D mountain Charles Schwab shares 5-day The analyst’s $67.50 target price, which is down from $81.50 previously, means shares can rise another 19% from Tuesday’s closing price. The stock is up nearly 2.9% in Wednesday premarket trading. The analyst said this means the stock has “overshot to the downside.” “[We] expect the [net new asset] NNA story to remain robust and capital ratios to quickly rebuild as we look into 2024-25, with the current value giving investors an opportunity to step into a high-quality, large-cap secular beneficiary,” Katz wrote. —CNBC’s Michael Bloom contributed to this report.
