HOOD vs SCHW Stock Comparison: AI Score, Valuation, Performance and Upside
HOOD and SCHW are both US retail brokerages but at vastly different scale. Schwab manages $9T+ in client assets and earns NII from its banking operations. Robinhood has tens of millions of younger, lower-balance users and depends on PFOF, crypto, and NII. Schwab is the incumbent value play with interest rate sensitivity; Robinhood is the fintech disruptor with a younger demographic and regulatory risk.
HOOD vs SCHW — Robinhood (the mobile-first fintech disruptor democratizing retail trading for younger investors via PFOF, crypto, and Gold subscriptions) versus Charles Schwab (the $9T+ AUC full-service brokerage and RIA custodian generating net interest income from its banking subsidiary as the dominant retail wealth platform).
SCHW holds the edge across 3 of 5 key metrics in this comparison. SCHW leads on both 1-year return (+12.83%) and forward P/E quality (14.11x vs 32.48x for HOOD), a relatively favorable combination of momentum and valuation. On fundamentals, HOOD is growing revenue faster (32.30%), while SCHW maintains the higher operating margin (52.28%) — a classic growth-versus-profitability split. Analyst consensus implies similar upside for both: +15.80% for HOOD and +13.43% for SCHW.
Human Wall Street analysts' price targets, typically implying a ~12-month view — a separate signal from this site's own AI Prediction Signal further down the page, which is a 5-/30-day machine-learning forecast based on price history alone.
- believe Robinhood's demographic advantage — onboarding millennial/Gen-Z investors early — creates a multi-decade compounding customer base as those users grow their wealth
- see crypto trading volumes as structural revenue growth as retail and institutional crypto adoption expands on Robinhood's platform
- value Robinhood's NII growth from rising rates and margin lending reducing PFOF dependency risk over time
- are comfortable with PFOF regulatory risk, lower average account balances, and paying a growth premium vs Schwab's value-oriented multiple
- prefer the dominant US retail brokerage with $9T+ AUC, #1 RIA custody position, and structural scale advantages from the TD Ameritrade merger
- value Schwab's interest rate sensitivity as a positive — higher-for-longer rates benefit NIM significantly on a large base of client cash sweep balances
- want dividend income and proven earnings power vs Robinhood's evolving profitability profile
- are comfortable with cash sorting headwinds compressing near-term NIM and multi-year TD Ameritrade client migration integration costs
| Metric | HOOD | SCHW |
|---|---|---|
| AI scorei | 54.0 | 53.2 |
| AI ranki | #314 | #350 |
| Latest closei | $119.82 | $105.25 |
| 1M returni | +25.11% | -5.08% |
| 6M returni | +69.02% | +11.19% |
| 1Y returni | -0.90% | +12.83% |
How much would $10,000 be worth today if invested at the start of each period, with all dividends reinvested?
| Period | HOOD | SCHW |
|---|---|---|
| 1Y ago | $9.6K (-4.0%) started 2025-09-19 | $11.16K (+11.6%) started 2025-09-19 |
| 5Y ago | $29.44K (+194.4%) started 2021-09-20 | $16.97K (+69.7%) started 2021-09-20 |
| 10Y ago | $34.41K (+244.1%) started 2021-07-29 | $42.95K (+329.5%) started 2016-09-19 |
Hypothetical — past performance does not guarantee future results.
| Metric | HOOD | SCHW |
|---|---|---|
| Market capi | $95.79B | $190.5B |
| Trailing P/Ei | 47.14 | 20.07 |
| Forward P/Ei | 32.48 | 14.11 |
| Price/Salesi | N/A | N/A |
| EV/Revenuei | 18.68 | 6.77 |
| Analyst targeti | $123.38 | $124.95 |
| Target upsidei | +15.80% | +13.43% |
| Metric | HOOD | SCHW |
|---|---|---|
| Revenue growthi | 32.30% | 20.90% |
| Earnings growthi | 47.60% | 42.60% |
| EPS growthi | +47.60% | +42.60% |
| FCF margini | N/A | N/A |
| Operating margini | 43.88% | 52.28% |
| Profit margini | 42.01% | 38.79% |
| ROIC proxyi | 23.62% | 20.27% |
| Return on equityi | 23.62% | 20.27% |
| Dividend yieldi | N/A | 1.16% |
| Payout ratioi | 0.00% | 21.49% |
| Dividend growth streaki | N/A | No increase yet |
| Betai | 2.32 | 0.75 |
| Debt/equityi | 240.28 | 151.11 |
| Current ratioi | 1.12 | 0.66 |
| Quick ratioi | 1.07 | 0.66 |
Over the past year, HOOD and SCHW have moved weakly in the same direction (correlation of 0.28), based on daily returns.
Lower drawdown and smaller single-period drops generally indicate a smoother ride, though they do not guarantee lower future risk.
| Period | Metric | HOOD | SCHW |
|---|---|---|---|
| 1Y | Growthi | -3.97% | +11.58% |
| CAGRi | -3.99% | +11.61% | |
| Volatilityi | 73.07% | 24.68% | |
| Sharpe ratioi | 0.24 | 0.39 | |
| Sortino ratioi | 0.37 | 0.52 | |
| Max drawdowni | 57.26% | 20.39% | |
| Current drawdowni | 21.41% | 7.39% | |
| Avg drawdowni | 32.20% | 7.06% | |
| Ulcer Indexi | 35.83% | 9.22% | |
| Max daily dropi | 13.24% | 7.63% | |
| Max wkly dropi | 28.21% | 13.18% | |
| 5Y | Growthi | +194.40% | +61.04% |
| CAGRi | +24.13% | +10.01% | |
| Volatilityi | 68.62% | 31.99% | |
| Sharpe ratioi | 0.59 | 0.32 | |
| Sortino ratioi | 0.90 | 0.45 | |
| Max drawdowni | 85.30% | 49.70% | |
| Current drawdowni | 21.41% | 7.39% | |
| Avg drawdowni | 51.86% | 18.54% | |
| Ulcer Indexi | 58.72% | 22.88% | |
| Max daily dropi | 19.79% | 12.77% | |
| Max wkly dropi | 28.21% | 32.23% | |
| 10Y | Growthi | +244.11% | +281.33% |
| CAGRi | +27.18% | +14.32% | |
| Volatilityi | 74.02% | 33.08% | |
| Sharpe ratioi | 0.63 | 0.44 | |
| Sortino ratioi | 0.99 | 0.63 | |
| Max drawdowni | 90.21% | 51.08% | |
| Current drawdowni | 21.41% | 7.39% | |
| Avg drawdowni | 59.34% | 17.05% | |
| Ulcer Indexi | 65.74% | 21.81% | |
| Max daily dropi | 27.59% | 12.77% | |
| Max wkly dropi | 28.21% | 32.23% |
| Category | HOOD | SCHW |
|---|---|---|
| Company | Robinhood Markets, Inc. | Charles Schwab Corporation |
| Sector | Financial Services | Financial Services |
| Industry | Capital Markets | Capital Markets |
| Core business | Robinhood is a retail fintech brokerage built on commission-free trading, fractional shares, and a mobile-first UX targeting younger investors. Revenue comes primarily from payment for order flow (PFOF), net interest income on cash and margin lending, and Robinhood Gold subscriptions. Robinhood has expanded into crypto trading, retirement accounts, and credit cards. The company went public in July 2021 after democratizing retail trading during the 2020-2021 meme stock era. | Charles Schwab is the largest US retail brokerage by assets under custody ($9T+), offering brokerage, banking, wealth management, and advisory services. Schwab completed the TD Ameritrade acquisition in 2020, becoming the dominant retail brokerage. Revenue comes from net interest income (primary), asset management fees, and trading commissions. Schwab's bank subsidiary earns spread income on client cash sweeps. The company serves retail investors, independent RIAs, and institutional clients. |
| Investor focus | Investors monitor Robinhood's monthly active users, ARPU trends, crypto trading volumes, net interest income from higher rates, and path to expanding beyond PFOF-dependent revenue. | Investors focus on Schwab's net interest margin, cash sorting trends, RIA custody market share, and expense management post-TD Ameritrade integration. |
- Mobile-first millennial/Gen-Z user base: Robinhood has onboarded tens of millions of younger investors who may grow assets over decades — long-term customer acquisition advantage vs incumbents
- Crypto leadership among retail brokers: Robinhood captures significant retail crypto volume with margin for high-volatility trading periods like Bitcoin ETF launches
- Net interest income expansion: higher interest rates improved Robinhood's NII from cash sweep and margin lending — reducing PFOF revenue dependency over time
- $9T+ assets under custody: Schwab's scale creates enormous NII opportunity and fee revenue — the TD Ameritrade integration created the dominant retail brokerage with network effects
- RIA custody leadership: Schwab is the largest custodian for independent RIAs — a high-quality, growing wealth management channel with sticky fee revenue
- Banking integration enables NIM: Schwab Bank collects spread income on billions in client cash — NII is the largest revenue contributor benefiting from higher interest rates
- PFOF regulatory risk: the SEC has proposed banning payment for order flow — a core Robinhood revenue stream — which would force significant business model restructuring
- Lower average account balances: Robinhood's average account size is far below Schwab's, limiting revenue per user for wealth management expansion
- Brand associated with speculative trading: meme stock and crypto association limits Robinhood's ability to attract older, wealthier customers more valuable to wealth management
- Cash sorting headwinds: clients moved billions from low-yield Schwab Bank sweeps to money market funds — significantly compressing NIM in 2023-2024
- Interest rate sensitivity: Schwab's earnings are heavily tied to rate levels — Fed rate cuts create NII headwinds on a large base
- TD Ameritrade integration complexity: multi-year client migration challenge — Schwab transferred TD clients and closed redundant accounts through 2024
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