Charles Schwab Corp. (NYSE:SCHW) got the classic post-earnings treatment from Wall Street on Friday: a round of price target tweaks, a split verdict, and a stock that couldn't quite decide how to feel about any of it.

The discount brokerage reported third-quarter results on Thursday. Adjusted earnings came in at $1.69 per share, beating the analyst consensus estimate of $1.66. Revenue rose 17% year over year to a record $7.17 billion, narrowly missing the consensus estimate of $7.19 billion. Good quarter, technically. The market's reaction, however, was less enthusiastic.

Citizens Sees Long-Term Strength Despite Margin Pressure

Citizens analyst Devin Ryan reiterated a Market Outperform rating and maintained a $120 price forecast. In his view, Schwab's record asset growth, improving revenue mix and expense discipline outweigh concerns about slower near-term margin recovery.

Ryan attributed the stock's initial 3% decline on Thursday to a weaker margin outlook. Strong loan demand and clients moving cash into investments forced Schwab to rely more heavily on expensive wholesale funding. That's the kind of thing that makes investors nervous, even when the underlying business is growing.

Investors were also disappointed by the company's $500 million share repurchase, compared with expectations of roughly $1.4 billion. A smaller buyback reads like a company hoarding its cash, which is rarely the headline shareholders want.

Ryan, though, viewed the smaller buyback as a decision to support client growth rather than a sign of weakening capital returns. Despite the funding pressure, he raised his 2027 adjusted earnings forecast by 5% to $7.65 per share.

He also highlighted artificial intelligence as a potential growth driver. Clients using AI-powered trading tools have doubled over six months, supporting higher trading activity and engagement.

JPMorgan Cuts Price Forecast As Funding Costs Rise

JPMorgan analyst Kenneth Worthington maintained an Overweight rating but lowered his price forecast to $147 from $150. He praised Schwab's ability to attract assets and expand revenue opportunities through lending, margin services and pledged asset lines.

However, he flagged declining deposits and rising short-term borrowing costs as near-term risks. Schwab's deposits fell to $244.1 billion, marking the third consecutive quarterly decline. Three quarters in a row is a trend, not a blip.

Worthington expects funding pressure to ease as deposit growth catches up with loan growth, potentially boosting margins and earnings in 2027. Still, he lowered his 2027 adjusted earnings forecast to $7.71 per share from $7.97 and cut his 2028 estimate to $9.18 from $9.28.

The analyst also sees AI improving client engagement and operating efficiency, although its financial benefits remain difficult to quantify. Fair enough. Nobody has a spreadsheet for that yet.

SCHW Price Action: Charles Schwab shares were down 2.45% at $91.85 at the time of publication on Friday, according to market data.