24/7 Wall St. has evaluated over 200 CEOs in order to select it CEO of the Year. Six finalists were chosen from the list. The measurements were based on company stock performance for the last two years, innovation, financial results, and the quality of the competition that each company faces in its markets. We also took into consideration whether the corporation was operating in an industry with special challenges.
The brokerage business has been unkind this year, but shares in Charles Schwab (SCHW) are up almost 30%. Merrill Lynch (MER) shares are down well over 30%. Granted, the big broker is in a number of businesses that Schwab is not, but that may be why SCHW has a price to sales ratio of 5.8. Merrill’s is 1.8x.
Schwab was also clearly wise in not making a big bet on the mortgage business the way that E*Trade (EFTC) did. Schwab basically stayed away from the Sirens and stayed with its knitting.
Schwab has remained the premier company for high-end retail traders. In October, its total client assets rose 24% from the year before to $1.484 trillion and daily average trades by clients moved up 29% to 318.7 thousand. The company has also continued to do well managing corporate retirement accounts.
Before Charles Schwab returned to the CEO chair, the company had gotten itself into real trouble. Its shares fell to $8.27 in mid-2004. They now change hands at $24.55, near a five-year high. Doing that in the current financial services environment is nothing short of amazing.
Douglas A. McIntyre is the former editor-in-chief of Financial World Magazine which began the CEO of the Year Awards in 1981. He is also the former president of Switchboard.
Top Gaining Stocks
Top Losing Stocks