Back to top

Image: Bigstock

Wells Fargo (WFC) Stock Dips While Market Gains: Key Facts

Read MoreHide Full Article

The most recent trading session ended with Wells Fargo (WFC - Free Report) standing at $59.34, reflecting a -0.97% shift from the previouse trading day's closing. The stock's change was less than the S&P 500's daily gain of 0.11%. Meanwhile, the Dow experienced a drop of 0.3%, and the technology-dominated Nasdaq saw an increase of 0.56%.

The biggest U.S. mortgage lender's shares have seen a decrease of 0.03% over the last month, not keeping up with the Finance sector's gain of 4.44% and the S&P 500's gain of 5.06%.

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 per share (EPS) are projected to be $1.25, reflecting no change from the same quarter last year. Meanwhile, our latest consensus estimate is calling for revenue of $20.23 billion, down 1.49% from the prior-year quarter.

In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $5.01 per share and a revenue of $81.65 billion, indicating changes of -7.73% and -1.15%, respectively, from the former year.

Investors should also take note of any recent adjustments to analyst estimates for Wells Fargo. Recent revisions tend to reflect the latest near-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the company's business and profitability.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. Wells Fargo currently has a Zacks Rank of #2 (Buy).

In the context of valuation, Wells Fargo is at present trading with a Forward P/E ratio of 11.97. This indicates a premium in contrast to its industry's Forward P/E of 11.35.

Also, we should mention that WFC has a PEG ratio of 1.6. 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 1.77 based on yesterday's closing prices.

The Banks - Major Regional industry is part of the Finance sector. At present, this industry carries a Zacks Industry Rank of 49, placing it within the top 20% of over 250 industries.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in 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.


See More Zacks Research for These Tickers


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


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

Published in