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Wells Fargo (WFC) Stock Declines While Market Improves: Some Information for Investors

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Wells Fargo (WFC - Free Report) closed the most recent trading day at $46, moving -0.22% from the previous trading session. The stock fell short of the S&P 500, which registered a gain of 0.39% for the day. At the same time, the Dow added 0.43%, and the tech-heavy Nasdaq gained 0.2%.

Heading into today, shares of the biggest U.S. mortgage lender had gained 12.74% over the past month, outpacing the Finance sector's gain of 7.81% and the S&P 500's gain of 5.28% in that time.

Analysts and investors alike will be keeping a close eye on the performance of Wells Fargo in its upcoming earnings disclosure. The company's earnings report is set to go public on January 12, 2024. On that day, Wells Fargo is projected to report earnings of $1.24 per share, which would represent year-over-year growth of 85.07%. Meanwhile, our latest consensus estimate is calling for revenue of $20.25 billion, up 3.01% from the prior-year quarter.

For the full year, the Zacks Consensus Estimates project earnings of $5.22 per share and a revenue of $82.32 billion, demonstrating changes of +66.24% and +11.56%, respectively, from the preceding year.

Any recent changes to analyst estimates for Wells Fargo should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.

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 0.16% lower. Wells Fargo is currently sporting a Zacks Rank of #3 (Hold).

Looking at valuation, Wells Fargo is presently trading at a Forward P/E ratio of 8.83. Its industry sports an average Forward P/E of 9.37, so one might conclude that Wells Fargo is trading at a discount comparatively.

It is also worth noting that WFC currently has a PEG ratio of 0.87. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The Banks - Major Regional was holding an average PEG ratio of 1.54 at yesterday's closing price.

The Banks - Major Regional industry is part of the Finance sector. At present, this industry carries a Zacks Industry Rank of 85, placing it within the top 34% of over 250 industries.

The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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