BofA Analyst Forecasts Slower Growth For Broker Stocks As Market Volatility Increases

BofA Securities analyst Craig Siegenthaler revised estimates and price forecasts for several broker stocks ahead of earnings season.

The analyst writes that a deeper equity market correction poses EPS risks from cash sweep revenues, trading/margin loans, and AUM-based fees.

Siegenthaler expects further NNA slowdowns, especially in higher ROCA retail channel vs. wealth manager, projecting a modest dip in March.

Since the correction happened late in the quarter, most risks will surface in the second quarter instead of the first quarter of 2025, adds the analyst.

Charles Schwab: The analyst projects Charles Schwab Corporation’s (NYSE:SCHW) NII to keep rising, regardless of market or rates, as it pays down its costly FHLB/CD borrowings.

He sees a third consecutive quarter of net new asset growth, with a 4.7% estimate, near the low end of the company’s 5%-7% target.

The analyst reiterated the Underperform rating on the company and lowered the price forecast from $74 to $66.

Also, Siegenthaler revised EPS estimates for first-quarter FY25 to $1.03 (from $1.01), 2026 to $4.27 ...