Schwab's profit spikes, stock price doesn't

The Charles Schwab Corp. Ticker:(SCHW) had a net increase of 18,000 new accounts during the third quarter, which helped propel the discount-brokerage firm to a 77% increase in net income over the comparable period last year. Net income for the three-months period through September reached $220 million, compared with $124 million for the year-earlier period, the company reported today. The broker's third-quarter revenue of $1.2 billion marked an 11% rise from the third quarter of 2010. Total investor accounts reached 5.7 million during a quarter, up 2% from a year earlier. But the 18,000 net new accounts, not including internal transfers, represented a 64% increase over the comparable period last year. “Given the weakened environment, we'll respond appropriately on the expense side while remaining true to our long-term strategy,” Schwab chief executive Walt Bettinger said in the report. “We recognize that effective expense discipline remains key to our ability to balance near-term profitability with investing in our clients to enhance their service experience and sustain our growth,” he added. RELATED ITEM Clients rate Schwab near top of big financial advisory firms As of noon EST, Schwab shares were trading at $12.27, down 3.7% from the start of the day. That compares with a 1.3% drop by the S&P 500 at noon today. Schwab's stock price has fallen 24.6% from the start of the year, which compares with a 2.6% drop by the S&P 500 over the same period.