Using the PEG framework with analyst consensus forward EPS growth of 20.7% plus 1.4% dividend yield, The Charles Schwab Corporation has a fair value of $121.41 based on NTM EPS (FY2026) of $5.88. The current PEG ratio is 0.78.
PEG < 1 = bargain, 1–1.5 = fair, > 2 = expensive.
PEG is most informative for high-growth companies — the PEG sweet spot.
| EPS Growth RateForward | 19.3% |
| Dividend Yield | +1.4% |
| Adjusted Growth (clamped 8–25%) | 20.7% |
| Fair P/E | 20.7x |
| NTM EPS (FY2026) | $5.88 |
| Fair Value | $121.41 |
| Period | EPS Est. | Growth | Analysts |
|---|---|---|---|
| FY2025 (actual) | $4.66 | — | — |
| FY2026E | $5.88 | +26.1% | 14 |
| FY2027E | $6.86 | +16.7% | 15 |
| FY2028E | $7.91 | +15.3% | 5 |
3Y Forward EPS CAGR: 19.3%
| Year | Net Income | EPS | YoY |
|---|---|---|---|
| FY2021 | $5.9B | $2.83 | — |
| FY2022 | $7.2B | $3.50 | +23.7% |
| FY2023 | $5.1B | $2.54 | -27.4% |
| FY2024 | $5.9B | $2.99 | +17.7% |
| FY2025 | $8.9B | $4.66 | +55.9% |
4Y Historical EPS CAGR: 13.3%
The PEG Fair Value uses the Price/Earnings-to-Growth framework. A stock is fairly valued when its P/E ratio equals its earnings growth rate (PEG = 1.0). This model adds dividend yield to the growth rate per the original PEGY formula.
Growth rate priority: analyst consensus forward EPS CAGR (when ≥ 3 analysts cover the stock), falling back to historical EPS CAGR. Using EPS rather than net income avoids distortion from share buybacks. The growth rate is clamped between 8% and 25% — below 8% would undervalue stable earners, while above 25% would overvalue unsustainable spikes.