Back to top

Analyst Blog

This page is temporarily not available.  Please check later as it should be available shortly. If you have any questions, please email customer support at support@zacks.com or call 800-767-3771 ext.  9339.

Investment brokerage firm, The Charles Schwab Corporation (SCHW - Analyst Report) revealed its plan to shift 1000 employees from San Francisco in the coming three to five years as a cost control initiative. Notably, the company will retain its headquarters in San Francisco.

The decision to trim down the employee base in San Francisco was primarily driven by the rising costs for carrying business as well as higher cost of living in the Bay Area. Further, Schwab encountered challenges in hiring professionals in the region owing to the cut-throat competition in the labor market.

Total number of employees at Schwab stood at 13,800, as of Dec 31, 2013, which includes 2700 employees in the Bay Area. However, the company is yet to arrive at a final decision as to which jobs are to be shifted. Also, Schwab is undecided on the probable locations for the transfer. However, a few options may include Arizona, Colorado, Florida, Indiana and Texas.

Notably, company’s fourth quarter 2013 net revenue rose 18% year over year to $1.4 billion, while total non-interest expense was up 8% year over year to $937 million. Therefore, the latest move seems to be a cost reduction initiative by Schwab in order to pave the way for garnering higher revenues in the near term.

Moreover, we believe that synergies from acquisitions and a stable capital position will boost the company’s financials in the near term, while we remain cautious owing to the macro economic head winds across the industry.

Currently, Schwab holds a Zacks Rank #2 (Buy). Some top-ranked Investment brokerage firms worth considering include Investment Technology Group Inc. (ITG - Snapshot Report), LPL Financial Holdings Inc. (LPLA - Snapshot Report) and E*TRADE Financial Corp. (ETFC - Analyst Report). Both Investment Technology and LPL Financial carry a Zacks Rank #1 (Strong Buy) while E*TRADE Financial holds the same rank as Schwab.

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

Learn more

Start for as little as $4.50 per trade.

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
DIXIE GROUP DXYN 15.84 +7.90%
BOFL HOLDING BOFI 85.30 +4.97%
RAMBUS INC RMBS 12.31 +4.41%
VIPSHOP HOLD VIPS 148.73 +4.35%
NETFLIX INC NFLX 345.74 +4.32%