Charles Schwab (Nasdaq: SCHW) still has it.
The leading discount broker came through with another healthy quarter, and that's saying plenty in an environment in which full-service giants like Bear Stearns (NYSE: BSC), and even fellow discounter E*Trade (Nasdaq: ETFC), are choking on bad investments.
Net revenue climbed 13% to top $1.3 billion during the first three months of the year. The bottom line clocked in even stronger, with profits from continuing operations climbing 29% -- or rising a sharp 37% on a diluted-share basis, to $0.26 a share.
Perhaps more important than the impressive income statement is the continued customer influx Schwab enjoys. The company landed $41.3 billion in net new assets during the period, closing out the quarter with $1.4 trillion in assets under its watch.
That's huge, because market volatility was going to help the top and bottom lines. It's definitely been a wild start to 2008. However, even with lower stock prices and plummeting fixed income yields, investors are still trusting Schwab -- and their own portfolio-managing judgment -- with more of their money. Those customers are sticking by Schwab even as banking giants like Bank of America (NYSE: BAC) and Wells Fargo (NYSE: WFC) try to woo cheap traders with rock-bottom commission schedules.
Naturally, we'll want to see how TD AMERITRADE (Nasdaq: AMTD) and E*Trade are doing before we generalize about the state of discount brokerages, but it won't be much of a wait. Both of those companies will report earnings on Thursday.
Schwab's strong showing hints at solid results. Now let's see whether the rest of the industry backs that up.
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