San Francisco, California-based Wells Fargo & Company (WFC) is a financial services company that provides diversified banking, investment, mortgage, and consumer and commercial finance products and services, Valued at a market cap of $278.4 billion, the company has recently focused on streamlining operations, improving risk management, and strengthening compliance while investing in digital transformation to enhance customer experience and efficiency.
This financial services giant has outpaced the broader market over the past 52 weeks. Shares of WFC have surged 31.7% over this time frame, while the broader S&P 500 Index ($SPX) has gained 18.1%. Moreover, on a YTD basis, the stock is up 22.4%, compared to SPX’s 17.2% rise.
Zooming in further, WFC’s outperformance looks even more pronounced when compared to the SPDR S&P Bank ETF’s (KBE) 2.7% uptick over the past 52 weeks and 1.8% YTD return.
Shares of WFC soared 7.2% on Oct. 14 after its strong Q3 earnings release. Due to higher net interest income and strong, broad-based growth in fee-based income, the company’s total revenue improved 5.3% year-over-year to $21.4 billion, surpassing consensus estimates by 1.2%. Moreover, its EPS of $1.66 advanced 16.9% from the year-ago quarter, topping analyst expectations.
For the current fiscal year, ending in December, analysts expect WFC’s EPS to grow 11.4% year over year to $6.15. The company’s earnings surprise history is promising. It exceeded the consensus estimates in each of the last four quarters.
Among the 27 analysts covering the stock, the consensus rating is a "Moderate Buy”, which is based on 14 “Strong Buy,” four "Moderate Buy," and nine “Hold” ratings.
This configuration is more bullish than a month ago, with two analysts suggesting a "Moderate Buy” rating.
On Oct. 24, Gerard Cassidy from RBC Capital maintained a "Buy" rating on WFC, with a price target of $88, implying a 2.3% potential upside from the current levels.
The mean price target of $95.06 represents a 10.5% premium from WFC’s current price levels, while the Street-high price target of $110 suggests an upside potential of 27.9%.
On the date of publication, Neharika Jain did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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