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Charles Schwab stock pops on net interest margin outlook

Shares of Charles Schwab (SCHW) are trading higher on Monday after the company raised its net interest margin forecast for 2024. Schwab cited increased investor engagement as the reason behind the improved outlook.

This announcement contrasts with the challenges faced by many financial services companies, which have seen their net interest income decline recently.

Yahoo Finance's Julie Hyman and Josh Lipton break down the details.

For more expert insight and the latest market action, click here to watch this full episode of Market Domination.

This post was written by Angel Smith

Video transcript

JULIE HYMAN: Let's talk Charles Schwab as well. The company missing estimates for total net new assets in the first quarter. But the brokerage expecting its net interest margin to expand through 2024. That's also really stands out in particular because a number of the big banks did not necessarily raise their forecasts for net interest margin or net interest income here. So interesting that Schwab is doing that, and the company saying that they are seeing solid investor engagement as well that contributed to a million new brokerage account openings in the quarter.

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JOSH LIPTON: Yeah, also, plan to resume stock repurchases as they say temporary headwinds continue to subside. CFOs saying capital return is a very, very important part of our financial formula.

JULIE HYMAN: Yeah, so that doesn't hurt when it comes to the stock going up today either.