Schwab (SCHW) – Net Interest Challenge – May 6th, 2020

Options Edge: Credit collects 43% of Width

The neutral DailyPlay for Wednesday, May 6th is Schwab (SCHW). SCHW has rallied almost 30% from March lows, but remain challenged as net interest provides downside pressure on revenues. 

Fundamental View

  • Rates have remained low providing strong downside pressure on revenues
  • $0 Commissions, lower fees provide further challenges to revenue growth
  • USAA & TD Ameritrade integration synergies not expected this quarter

Technical View

  • SCHW’s 1M and 6M trend has turned neutral on March 1st. 
  • SCHW broke below its $35 support level
  • Neutral relative strength score (5 out of 10)
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