Schwab Equity Ratings Highlight Ten Stocks to Watch in 2005

Schwab Equity Ratings Highlight Ten Stocks to Watch in 2005 


SAN FRANCISCO, Jan. 19  /PRNewswire-FirstCall/ -- Schwab Equity Ratings(R),
Charles Schwab & Co.'s successful approach to stock selection, have helped
identify ten stocks investors should consider as they review their portfolio
for 2005.  Greg Forsythe, developer of Schwab's A, B, C, D, or F stock rating
system, said that the list is comprised of larger market cap stocks, which look
attractive after four straight years of small-cap outperformance.

"The new year is a natural time to clean out the cobwebs from your stock
portfolio," Forsythe said. "You want to eliminate non-performing investments
and replace them with others you think will do better. We use Schwab Equity
Ratings to sort through 3,000 stocks and assign grades that people find easy to
use when determining stocks to buy or sell."  Out of approximately 160 A- rated
stocks, Forsythe identified ten in particular that investors might want to
consider when doing their annual portfolio review.

Schwab Equity Ratings' Ten Interesting Stocks, One from Each Sector Forsythe
screened for A-rated mid and large cap stocks representing each of the market's
ten broad economic sectors.  They are:

Becton Dickinson (BDX) continues to grow steadily and generate more cash than
its capital requirements, enabling the firm to raise its dividend and buy back
shares.

Duke Energy (DUK) has returned to its roots and is producing strong results
after getting caught up in the energy trading market collapse a few years ago.

Electronic Data Systems (EDS) is recovering from its 2003 earnings collapse and
has reported earnings per share above pessimistic consensus forecasts four
straight quarters.

Exxon Mobil (XOM) has steadily ridden the wave of rising energy prices. Recent
stock buy backs and insider buying signal that management feels the stock is
still undervalued.

MetLife (MET) continues to post strong operating results, yet its valuation
appears cheap, reflecting likely overblown fears of rising interest rates and
insurance industry litigation, the reason for the "pertinent news" asterisk on
the chart.

Newell Rubbermaid (NWL) has struggled for years to regain its growth status. 
Recent improvements in free cash flow, earnings quality and a 3.4% dividend are
all good signs.

PPG Industries (PPG) is prudently employing its free cash flow strength to pay
down debt, buy back shares and increase its dividend (for the 33rd consecutive
year!).

Textron (TXT) is generating strong free cash flow, growth and earnings that
consistently exceed analyst forecasts from its diverse portfolio of industrial
operations.

UST (UST) is using its excess cash flow to buy back shares and pay out a 4.4%
dividend yield, while recent insider buying helps allay fears about near-term
risks from ongoing tobacco industry litigation. Note "pertinent news" asterisk
on the chart.

Verizon (VZ) offers stability and fundamental strength, providing a relatively
conservative way to invest in the rapidly evolving telecommunications sector.

  Ten Stocks to Watch for 2005

                         Schwab  Stock  Market    P/E   Dividend     5Yr
                         Equity  Price   Cap    forecast  Yield   Forecasted
  Company     Sector     Rating                   EPS                EPS
                                                                   Growth
                                                                    Rate
  Becton      Health Care   A   $55.01  $13.5B    19.6     1.3%     12.4%
  Dickinson

  Duke Energy Utilities     A   $25.40  $23.6B    18.6     4.3%      3.8%

  Electronic
  Data        Information   A   $22.10  $11.1B    86.8     0.9%     10.2%
  Systems     Technology

  Exxon Mobil Energy        A   $51.50 $329.5B    13.7     2.1%      6.8%

  MetLife     Financial     A*  $41.03  $30.5B    12.1     1.1%     11.2%

  Newell      Consumer      A   $23.04   $6.3B    16.9     3.6%      9.4%
  Rubbermaid  Discretionary

  PPG
  Industries  Materials     A   $66.21  $11.4B    16.8     2.7%      8.5%

  Textron     Industrials   A   $72.18   $9.9B    21.8     1.9%     12.5%

  UST         Consumer      A*  $49.71   $8.2B    15.6     4.4%      7.3%
              Staples

  Verizon     Telecom       A   $37.68   $102B    14.7     4.1%     6.1%

  As of January 18, 2005


  About Schwab Equity Ratings


Schwab Equity Ratings offer an objective, disciplined and quantitative
evaluation of approximately 3,000 U.S. equities, more than any other major
brokerage firm. Stocks are assigned grades of A, B, C, D, or F, reflecting
performance potential over the next 12 months.  Schwab's outlook is that "A"
rated stocks, on average, will strongly outperform and "F" rated stocks, on
average, will strongly underperform the equities market over the next 12
months.. The ratings assess four broad categories: fundamentals, valuation,
momentum, and risk. They are updated each week to reflect new financial data
and other information.  Individuals use Schwab Equity Ratings to make decisions
about stocks to buy and sell. Schwab currently offers six mutual funds based on
Schwab Equity Ratings and publishes a composite stock list comprised of 30
highly rated stocks across all sectors.  For more information, go to
http://www.schwab.com/public/schwab/advice_research/schwab_equity_ratings

(On average, Schwab Equity Ratings' A-rated stocks outperformed the Dow Jones
Wilshire 5000 Composite Index in the 52-week period from January 12, 2004
through January 10, 2005.(1)  The average performance of all stocks rated A on
January 12 2004, through the 52 weeks up to January 10, 2005 was 18.56%
compared to a return of 8.14% during that period for the Index. The average
performance of all stocks rated F on January 12 2004 through the 52 weeks to up
to January 10, 2005, was -0.11%. For more information on Schwab Equity Ratings,
including performance details, how performance was calculated, comparison of
performance to benchmarks and limitations of model performance, visit
http://www.schwab.com/serperformance.

About Charles Schwab

The Charles Schwab Corporation (NYSE / Nasdaq: SCH), through its operating
subsidiaries, provides securities brokerage and financial services to
individual investors and the independent investment advisors who work with
them. With over 7 million individual investor accounts and more than $1
trillion in client assets, The Charles Schwab Corporation is one of the
nation's largest financial services firms. Its subsidiary Charles Schwab & Co.,
Inc. (member SIPC) provides a complete range of investment services and
products, including an extensive selection of mutual funds; financial planning
and investment advice; retirement plans; referrals to independent fee-based
investment advisors; and custodial, operational and trading support for
independent fee-based investment advisors. Its subsidiary Charles Schwab Bank
(member FDIC) provides banking and mortgage services and products. The
corporation's other operating subsidiaries include U.S. Trust Corporation
(member FDIC) and CyberTrader(R), Inc. (member SIPC) .These companies' Web
sites can be reached at http://www.schwab.com/, http://www.schwabbank.com/,
http://www.ustrust.com/, and http://www.cybertrader.com/.   [005-6584]

Analyst Certification: Greg Forsythe certifies the views expressed in these
materials accurately reflect the analysts' personal views about the subject
securities and issuers and that no part of the analysts' compensation was, is
or will be related to the specific recommendations or views in these materials.

For important research disclosures on the companies listed, please write to
Charles Schwab & Co., Inc., 101 Montgomery St., Corporate Public Relations, San
Francisco, CA 94104.

* Check current news because a potentially significant event has been announced
for this A-rated stock. In any event, you should always check news on a stock
before placing a trade.

(1) Performance of a single stock or group of stocks within a Schwab Equity
Ratings model performance cohort can vary greatly from the performance of that
cohort. The performance figures discussed above represent past performance and
are not indicative of future performance. Investors would not likely be able to
achieve the same performance as that discussed for various reasons explained in
detail on schwab.com. 

DATASOURCE: Charles Schwab



CONTACT:  Sondra Harris of Charles Schwab Corporation, [phone],

or 



Web site:  http://www.schwab.com/ 

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