In the latest market close, Wells Fargo (WFC) reached $53.61, with a -1.02% movement compared to the previous day. The stock’s performance was behind the S&P 500’s daily loss of 0.19%. Meanwhile, the Dow experienced a drop of 0.7%, and the technology-dominated Nasdaq saw an increase of 0.04%.
Coming into today, shares of the biggest U.S. mortgage lender had lost 3.73% in the past month. In that same time, the Finance sector gained 1.52%, while the S&P 500 gained 1.95%.
The investment community will be paying close attention to the earnings performance of Wells Fargo in its upcoming release. The company’s earnings per share (EPS) are projected to be $1.28, reflecting a 7.91% decrease from the same quarter last year. Our most recent consensus estimate is calling for quarterly revenue of $20.4 billion, down 2.2% from the year-ago period.
For the full year, the Zacks Consensus Estimates project earnings of $5.11 per share and a revenue of $82.28 billion, demonstrating changes of -5.89% and -0.39%, respectively, from the preceding year.
Any recent changes to analyst estimates for Wells Fargo should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company’s business outlook.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 0.07% decrease. Wells Fargo is currently sporting a Zacks Rank of #3 (Hold).
Looking at its valuation, Wells Fargo is holding a Forward P/E ratio of 10.61. This indicates a discount in contrast to its industry’s Forward P/E of 12.33.
We can additionally observe that WFC currently boasts a PEG ratio of 1.31. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company’s projected earnings growth. The Banks – Major Regional industry currently had an average PEG ratio of 1.53 as of yesterday’s close.
The Banks – Major Regional industry is part of the Finance sector. Currently, this industry holds a Zacks Industry Rank of 75, positioning it in the top 30% of all 250+ industries.
The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
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Source: finance.yahoo.com
