Zacks Investment Research Downgrades Wells Fargo & Co (WFC) to Hold

Zacks Investment Research downgraded shares of Wells Fargo & Co (NYSE:WFC) from a buy rating to a hold rating in a research note issued to investors on Sunday.

According to Zacks, “Shares of Wells Fargo underperformed the industry over the last six months. The company possesses a decent earnings surprise history, having beaten the Zacks Consensus Estimate in two of the trailing four quarters. Recently, the bank received the judge’s final approval for the settlement of $142 million worth class-action lawsuit related to the 3.5 million fake accounts scandal. Also, Wells Fargo was slapped with new sanctions, including a cap on the assets position by the Federal Reserve. Though lower tax rate, easing of regulations and expansions will likely support the bank’s growth profile, the crisis related to the revelation of illegally opening millions of illegal accounts in 2016 will take some time to alleviate. Moroever, rising rates are expected to aid net interest income. Furthermore, the recent 2018 capital plan approval boosts investors' confidence.”

Other equities analysts have also issued reports about the company. UBS Group raised Wells Fargo & Co from a neutral rating to a buy rating and set a $55.00 price target for the company in a research note on Thursday, April 5th. Sandler O’Neill reissued a buy rating and set a $64.00 price target on shares of Wells Fargo & Co in a research note on Friday, April 13th. Vining Sparks reissued a buy rating and set a $65.00 price target on shares of Wells Fargo & Co in a research note on Friday, April 13th. Vetr raised Wells Fargo & Co from a hold rating to a buy rating and set a $54.10 price target for the company in a research note on Wednesday, April 11th. Finally, Buckingham Research dropped their price target on Wells Fargo & Co from $75.00 to $70.00 and set a buy rating for the company in a research note on Monday, April 16th. Four analysts have rated the stock with a sell rating, eight have given a hold rating and fifteen have given a buy rating to the company. The company currently has a consensus rating of Hold and a consensus target price of $62.19.

NYSE:WFC opened at $55.36 on Friday. Wells Fargo & Co has a 12-month low of $49.27 and a 12-month high of $66.31. The stock has a market cap of $270.03 billion, a P/E ratio of 13.47, a price-to-earnings-growth ratio of 1.50 and a beta of 1.14. The company has a debt-to-equity ratio of 1.27, a current ratio of 0.88 and a quick ratio of 0.86.

Wells Fargo & Co (NYSE:WFC) last announced its quarterly earnings results on Friday, April 13th. The financial services provider reported $1.12 EPS for the quarter, beating analysts’ consensus estimates of $1.07 by $0.05. Wells Fargo & Co had a return on equity of 12.46% and a net margin of 22.80%. The company had revenue of $21.93 billion during the quarter, compared to analyst estimates of $21.74 billion. During the same period in the prior year, the company earned $1.00 earnings per share. The firm’s revenue was down 1.4% on a year-over-year basis. research analysts anticipate that Wells Fargo & Co will post 4.57 EPS for the current year.

In other news, EVP Petros G. Pelos sold 25,567 shares of the firm’s stock in a transaction that occurred on Thursday, May 24th. The stock was sold at an average price of $54.76, for a total value of $1,400,048.92. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through this hyperlink. 0.09% of the stock is owned by company insiders.

Several large investors have recently bought and sold shares of WFC. Magellan Asset Management Ltd lifted its stake in shares of Wells Fargo & Co by 24.1% in the 1st quarter. Magellan Asset Management Ltd now owns 31,024,898 shares of the financial services provider’s stock valued at $1,626,015,000 after purchasing an additional 6,017,222 shares during the last quarter. Viking Global Investors LP lifted its stake in shares of Wells Fargo & Co by 181.3% in the 4th quarter. Viking Global Investors LP now owns 5,338,016 shares of the financial services provider’s stock valued at $323,857,000 after purchasing an additional 3,440,121 shares during the last quarter. Rockefeller Capital Management L.P. bought a new stake in shares of Wells Fargo & Co in the 1st quarter valued at approximately $154,981,000. Massachusetts Financial Services Co. MA lifted its stake in shares of Wells Fargo & Co by 5.2% in the 1st quarter. Massachusetts Financial Services Co. MA now owns 50,957,630 shares of the financial services provider’s stock valued at $2,670,689,000 after purchasing an additional 2,497,659 shares during the last quarter. Finally, Natixis lifted its stake in shares of Wells Fargo & Co by 334.1% in the 1st quarter. Natixis now owns 2,662,960 shares of the financial services provider’s stock valued at $138,523,000 after purchasing an additional 2,049,539 shares during the last quarter. 76.10% of the stock is owned by institutional investors and hedge funds.

About Wells Fargo & Co

Wells Fargo & Company, a diversified financial services company, provides retail, commercial, and corporate banking services to individuals, businesses, and institutions. The company's Community Banking segment offers checking and savings accounts; credit and debit cards; and automobile, student, mortgage, home equity, and small business loans.

Further Reading: Analyst Ratings

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