Wells Fargo (WFC) Outpaces Stock Market Gains: What You Should Know
Zacks Investment Research | Jun 22, 2021 05:50AM ET
In the latest trading session, Wells Fargo (NYSE:WFC) closed at $43.54, marking a +0.6% move from the previous day. This move outpaced the S&P 500's daily gain of 0.51%.
Coming into today, shares of the biggest U.S. mortgage lender had lost 6.4% in the past month. In that same time, the Finance sector lost 0.8%, while the S&P 500 gained 1.75%.
WFC will be looking to display strength as it nears its next earnings release. In that report, analysts expect WFC to post earnings of $0.93 per share. This would mark year-over-year growth of 240.91%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $17.75 billion, down 0.48% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $3.87 per share and revenue of $71.06 billion. These totals would mark changes of +843.9% and -1.77%, respectively, from last 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. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
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.
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. The Zacks Consensus EPS estimate has moved 0.76% higher within the past month. WFC currently has a Zacks Rank of #3 (Hold).
Looking at its valuation, WFC is holding a Forward P/E ratio of 11.19. This represents a discount compared to its industry's average Forward P/E of 11.63.
We can also see that WFC currently has a PEG ratio of 1.1. 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. The Banks - Major Regional industry currently had an average PEG ratio of 1.37 as of yesterday's close.
The Banks - Major Regional industry is part of the Finance sector. This industry currently has a Zacks Industry Rank of 133, which puts it in the bottom 48% 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.
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