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Fly News Breaks for July 26, 2019
Jul 26, 2019 | 08:44 EDT
After Charles Schwab (SCHW) announced an agreement to acquire assets of USAA's Investment Management Company, including brokerage and managed portfolio accounts, for $1.8B in cash, Morgan Stanley analyst Michael Cyprys said he believes mid-single digit accretion is achievable with upside potential. In terms of read-across to others in the industry, he thinks the acquisition could raise prospects for greater brokerage/wealth management industry consolidation in which peers, including E-Trade (ETFC) and TD Ameritrade (AMTD), could potentially benefit, Cyprys tells investors. However, he believes Schwab's acquisition could be negative for Victory Capital (VCTR) as it introduces significant competition within the USAA membership network. Cyprys keeps an Overweight rating on Charles Schwab shares with a $48 price target.