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

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In the latest trading session, Wells Fargo (WFC - Free Report) closed at $41.02, marking a -1.25% move from the previous day. This move lagged the S&P 500's daily loss of 0.7%. Meanwhile, the Dow lost 0.57%, and the Nasdaq, a tech-heavy index, lost 1.06%.

Coming into today, shares of the biggest U.S. mortgage lender had lost 6.61% in the past month. In that same time, the Finance sector lost 1.75%, while the S&P 500 gained 0.58%.

Wall Street will be looking for positivity from Wells Fargo as it approaches its next earnings report date. This is expected to be October 13, 2023. On that day, Wells Fargo is projected to report earnings of $1.24 per share, which would represent a year-over-year decline of 4.62%. Meanwhile, our latest consensus estimate is calling for revenue of $20.23 billion, up 3.72% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $4.84 per share and revenue of $81.31 billion. These totals would mark changes of +54.14% and +10.2%, respectively, from last year.

Any recent changes to analyst estimates for Wells Fargo should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for 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 0.35% lower. Wells Fargo is currently a Zacks Rank #3 (Hold).

Valuation is also important, so investors should note that Wells Fargo has a Forward P/E ratio of 8.59 right now. For comparison, its industry has an average Forward P/E of 8.59, which means Wells Fargo is trading at a no noticeable deviation to the group.

We can also see that WFC currently has a PEG ratio of 0.84. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. Banks - Major Regional stocks are, on average, holding a PEG ratio of 1.5 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 109, which puts it in the top 44% 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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