LIVE
SCHW
The Charles Schwab Corporation · Financials - Retail Brokerage & Banking
$91.70
-0.12% this month
VERSUS
⟷
COMPARE
MS
Morgan Stanley (E*TRADE) · Financials - Investment Bank & Wealth Management
$223.17
+17.72% this month
Scoreboard verdict
Across AI score, momentum, valuation, upside, operating margin
SCHW
3
MS
2
Comparison scoreboard
SCHW LEADS 3/5AI Score
SCHW 51.4
MS ✓59.6
1Y Return
SCHW +3.08%
MS ✓+71.55%
Fwd P/E
SCHW ✓12.56
MS 16.84
Target Up.
SCHW ✓+27.39%
MS -4.85%
Op. Margin
SCHW ✓49.35%
MS 40.62%
Metrics last refreshed: 6/20/2026
Quick take
SCHW Stock Analysis: AI Score, Valuation, Performance and Upside
SCHW (Charles Schwab) is the dominant retail brokerage following its TD Ameritrade acquisition, with trillions in client assets and significant net interest income from client cash balances — but facing interest rate sensitivity as client cash moves to higher-yielding alternatives. Morgan Stanley's acquisition of E*TRADE created a different model: combining self-directed brokerage with advisor-driven wealth management for a broader wealth client spectrum.
SCHW vs MS (post-E*TRADE) is pure-play retail brokerage scale (Schwab's dominant position in custody, self-directed investing, and RIA services with significant interest rate income sensitivity) versus integrated wealth management (Morgan Stanley's E*TRADE acquisition enabling both self-directed and advisor-assisted wealth services across client segments) — two models for winning the long-term wealth management client relationship.
Live analysis · updated 6/20/2026
SCHW holds the edge across 3 of 5 key metrics in this comparison. MS has delivered stronger 1-year price return (+71.55% vs +3.08%), though SCHW trades at the lower forward P/E (12.56x vs 16.84x). On fundamentals, MS is growing revenue faster (16.30%), while SCHW maintains the higher operating margin (49.35%) — a classic growth-versus-profitability split. Analyst consensus implies meaningfully more upside for SCHW (+27.39%) than for MS (-4.85%).
Normalized 1Y performance
SCHW
MS
Recent returns
SCHW
MS
Analyst price targets & sentiment
SCHW
Price target range
analyst mean$116.05
current price$91.70
+27.4% upside to analyst mean
MS · 19 analysts
STRONG BUYHOLDSTRONG SELL
Hold (2.6/5.0)
Price target range
analyst low$101.00
analyst mean$203.67
current price$223.17
-4.8% upside to analyst mean
Who should consider this stock?
SCHW may suit investors who:
- →Want exposure to the dominant U.S. retail brokerage with the strongest brand, client asset scale, and thinkorswim platform for active traders following the TD Ameritrade integration
- →Believe Schwab's cash sweep model will benefit when interest rates normalize and client money flows back from money market funds into Schwab sweep accounts, restoring high-margin net interest income
- →Value Schwab's RIA custodian franchise as a growing fee-based revenue stream as registered investment advisors select Schwab to custody their client accounts
MS (E*TRADE segment) may suit investors who:
- →Want broad financial services exposure including investment banking, institutional trading, and the E*TRADE self-directed brokerage — Morgan Stanley's diversified revenue mix across market cycles
- →Value the E*TRADE acquisition as expanding Morgan Stanley's addressable market down into mass-affluent self-directed investors who may eventually migrate to full advisor relationships
- →Prefer Morgan Stanley's balance sheet strength and financial institution diversification versus Schwab's more concentrated net interest income sensitivity to the deposit/sweep rate spread
Performance & AI score
| Metric | SCHW | MS |
|---|---|---|
| AI score | 51.4 | 59.6 |
| AI rank | #376 | #172 |
| Latest close | $91.70 | $223.17 |
| 1M return | -0.12% | +17.72% |
| 6M return | -5.08% | +27.67% |
| 1Y return | +3.08% | +71.55% |
$10,000 invested — hypothetical growth (dividends reinvested)
How much would $10,000 be worth today if invested at the start of each period, with all dividends reinvested?
| Period | SCHW | MS |
|---|---|---|
| 1Y ago | $10.2K (+2.0%) started 2025-06-18 | $16.84K (+68.4%) started 2025-06-18 |
| 5Y ago | $14.06K (+40.6%) started 2021-06-21 | $34.44K (+244.4%) started 2021-06-21 |
| 10Y ago | $40.55K (+305.5%) started 2016-06-20 | $149.52K (+1395.2%) started 2016-06-20 |
Hypothetical — past performance does not guarantee future results.
Valuation & upside potential
| Metric | SCHW | MS |
|---|---|---|
| Market cap | $158.44B | $337.6B |
| Trailing P/E | 18.11 | 19.39 |
| Forward P/E | 12.56 | 16.84 |
| Price/Sales | N/A | 3.31 |
| EV/Revenue | 5.17 | 3.62 |
| Analyst target | $116.05 | $203.67 |
| Target upside | +27.39% | -4.85% |
Growth, profitability & risk
| Metric | SCHW | MS |
|---|---|---|
| Revenue growth | 15.80% | 16.30% |
| Earnings growth | 38.60% | 31.90% |
| EPS growth | +38.60% | +31.90% |
| FCF margin | N/A | N/A |
| Operating margin | 49.35% | 40.62% |
| Profit margin | 37.99% | 24.75% |
| ROIC proxy | 19.08% | 16.39% |
| Return on equity | 19.08% | 16.39% |
| Dividend yield | 1.41% | 1.87% |
| Beta | 0.77 | 1.22 |
| Debt/equity | 120.77 | 502.25 |
| Current ratio | 0.63 | 1.96 |
| Quick ratio | 0.63 | 1.53 |
Drawdown & downside risk
Lower drawdown and smaller single-period drops generally indicate a smoother ride, though they do not guarantee lower future risk.
1Y risk snapshot
SCHW max drawdown20.39%
MS max drawdown19.28%
SCHW max wkly drop13.18%
MS max wkly drop8.42%
5Y risk snapshot
SCHW max drawdown49.70%
MS max drawdown32.38%
SCHW max wkly drop32.23%
MS max wkly drop13.51%
10Y risk snapshot
SCHW max drawdown51.08%
MS max drawdown51.33%
SCHW max wkly drop32.23%
MS max wkly drop26.49%
Performance metrics by period
| Period | Metric | SCHW | MS |
|---|---|---|---|
| 1Y | Growth | +1.99% | +68.40% |
| CAGR | +1.99% | +68.53% | |
| Sharpe ratio | 0.02 | 1.98 | |
| Max drawdown | 20.39% | 19.28% | |
| Max daily drop | 7.63% | 6.19% | |
| Max wkly drop | 13.18% | 8.42% | |
| 5Y | Growth | +33.03% | +197.87% |
| CAGR | +5.88% | +24.44% | |
| Sharpe ratio | 0.20 | 0.75 | |
| Max drawdown | 49.70% | 32.38% | |
| Max daily drop | 12.77% | 9.51% | |
| Max wkly drop | 32.23% | 13.51% | |
| 10Y | Growth | +259.05% | +1016.24% |
| CAGR | +13.64% | +27.30% | |
| Sharpe ratio | 0.42 | 0.78 | |
| Max drawdown | 51.08% | 51.33% | |
| Max daily drop | 12.77% | 15.60% | |
| Max wkly drop | 32.23% | 26.49% |
Business comparison
| Category | SCHW | MS |
|---|---|---|
| Company | The Charles Schwab Corporation | Morgan Stanley (E*TRADE) |
| Sector | Financial Services | Financial Services |
| Industry | N/A | Capital Markets |
| Core business | Charles Schwab is the largest retail brokerage in the U.S. — combining Schwab's legacy discount brokerage with TD Ameritrade's platform, thinkorswim trading tools, and RIA custodian services after the 2020 acquisition. Schwab operates its bank (Schwab Bank), generates significant net interest income from client cash balances, and provides investment management through Schwab Asset Management. | Morgan Stanley acquired E*TRADE in 2020 for $13 billion, integrating E*TRADE's retail brokerage and banking services into Morgan Stanley's wealth management division. E*TRADE provided Morgan Stanley with mass-affluent self-directed brokerage clients, complementing Morgan Stanley's advisor-driven wealth management for high-net-worth individuals. |
| Investor focus | Investors track Schwab's net interest margin (the spread on client cash balances — a critical revenue driver), client asset levels (total assets in custody determining fee revenue), net new assets from client acquisition, trading revenue, and the Schwab Bank's balance sheet after the 2023 interest rate dislocation. | For E*TRADE comparison purposes, investors evaluate Morgan Stanley Wealth Management segment metrics (net new assets, fee-based client assets, E*TRADE integration progress) and how E*TRADE's self-directed brokerage has been combined with Morgan Stanley's financial advisor network. |
SCHW strengths
- →Scale dominance post-TD Ameritrade — Schwab is by far the largest retail brokerage with trillions in client assets, enabling cost advantages, product breadth, and brand recognition that smaller competitors cannot match
- →Client cash monetization — Schwab earns significant net interest income by deploying client cash balances (in Schwab Bank) into higher-yielding investments while paying clients below-market rates; this 'cash sweep' model generates substantial revenue with low marginal cost
- →thinkorswim platform (from TD Ameritrade) serves active traders — the most sophisticated retail trading platform in the industry, preventing Schwab from losing active trader accounts to Interactive Brokers or other premium platforms
MS strengths
- →Complementary client segments — E*TRADE's self-directed mass-affluent clients and Morgan Stanley's advisor-served ultra-high-net-worth clients serve different but connected wealth segments, with opportunities to upgrade E*TRADE clients into full advisory relationships
- →Morgan Stanley financial strength — E*TRADE benefits from Morgan Stanley's AAA/AA credit rating, large balance sheet, and institutional investment banking credibility versus the standalone brokerage model
- →Wealth management fee revenue — as E*TRADE clients migrate to fee-based relationships at Morgan Stanley, the revenue becomes more recurring and less trading-transaction-dependent
Risks to watch — SCHW
- →Interest rate sensitivity — when rates rose rapidly in 2022-2023, clients moved cash from Schwab's low-yield sweep accounts to money market funds and CDs, shrinking the high-margin cash sweep revenue that Schwab depends on
- →2023 bank stress — rising rates caused unrealized losses in Schwab Bank's bond portfolio (a similar dynamic to SVB); while Schwab's retail base is more stable than SVB's depositor base, the market questioned Schwab's balance sheet resilience
- →Fidelity and Vanguard competition — both private (Fidelity) and member-owned (Vanguard) competitors can price aggressively without public shareholder return pressure, creating persistent competitive intensity in the zero-commission era
Risks to watch — MS
- →E*TRADE brand integration — Morgan Stanley has maintained the E*TRADE brand for self-directed clients while integrating operations; the dual-brand strategy must not confuse clients or dilute either brand's positioning
- →Technology integration complexity — combining E*TRADE's technology stack with Morgan Stanley's systems is a multi-year project; technology friction during integration can lead to client attrition
- →Self-directed clients may not migrate to advisor relationships — E*TRADE's value proposition for self-directed investors may be undermined if Morgan Stanley pushes too hard to convert them to higher-cost advisor relationships they don't want
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