Back to top

Wells Fargo (WFC) Gains But Lags Market: What You Should Know

Read MoreHide Full Article

Wells Fargo (WFC - Free Report) closed the most recent trading day at $53.55, moving +0.6% from the previous trading session. This move lagged the S&P 500's daily gain of 0.65%. Elsewhere, the Dow gained 0.79%, while the tech-heavy Nasdaq added 1.01%.

Coming into today, shares of the biggest U.S. mortgage lender had gained 1.1% in the past month. In that same time, the Finance sector lost 4.88%, while the S&P 500 lost 6.82%.

WFC will be looking to display strength as it nears its next earnings release, which is expected to be January 11, 2019. On that day, WFC is projected to report earnings of $1.19 per share, which would represent year-over-year growth of 22.68%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $21.27 billion, down 3.53% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $4.29 per share and revenue of $86.13 billion. These totals would mark changes of +4.38% and -2.29%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for WFC. These revisions typically reflect the latest short-term business trends, which can change frequently. 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. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable 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. Within the past 30 days, our consensus EPS projection has moved 0.52% lower. WFC is currently a Zacks Rank #3 (Hold).

Digging into valuation, WFC currently has a Forward P/E ratio of 12.42. This represents a premium compared to its industry's average Forward P/E of 11.37.

Meanwhile, WFC's PEG ratio is currently 1.19. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Banks - Major Regional stocks are, on average, holding a PEG ratio of 1.2 based on yesterday's closing prices.

The Banks - Major Regional industry is part of the Finance sector. This group has a Zacks Industry Rank of 71, putting it in the top 28% 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.

To follow WFC in the coming trading sessions, be sure to utilize Zacks.com.




In-Depth Zacks Research for the Tickers Above


Normally $25 each - click below to receive one report FREE:


Wells Fargo & Company (WFC) - free report >>

More from Zacks Tale of the Tape

You May Like

Published in