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Wells Fargo (WFC) Dips More Than Broader Markets: What You Should Know

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Wells Fargo (WFC - Free Report) closed the most recent trading day at $46.41, moving -1.32% from the previous trading session. This change lagged the S&P 500's 1.19% loss on the day.

Heading into today, shares of the biggest U.S. mortgage lender had gained 8.24% over the past month, outpacing the Finance sector's loss of 2.52% and the S&P 500's loss of 3.16% in that time.

Investors will be hoping for strength from WFC as it approaches its next earnings release. In that report, analysts expect WFC to post earnings of $1.05 per share. This would mark year-over-year growth of 87.5%. Our most recent consensus estimate is calling for quarterly revenue of $18.7 billion, down 0.87% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $4.40 per share and revenue of $74.97 billion, which would represent changes of +973.17% and +3.63%, respectively, from the prior year.

Any recent changes to analyst estimates for WFC should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.58% higher. WFC currently has a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that WFC has a Forward P/E ratio of 10.69 right now. Its industry sports an average Forward P/E of 11.7, so we one might conclude that WFC is trading at a discount comparatively.

Meanwhile, WFC's PEG ratio is currently 1.05. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Banks - Major Regional stocks are, on average, holding a PEG ratio of 1.33 based on yesterday's closing prices.

The Banks - Major Regional industry is part of the Finance sector. This industry currently has a Zacks Industry Rank of 83, which puts it in the top 33% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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