Wells Fargo & Company (NYSE:WFC) Shares Gap Up Following Better-Than-Expected Earnings

Key Points

• Wells Fargo & Company reported better-than-expected quarterly earnings with an EPS of $1.66, exceeding analysts' estimates of $1.55.
• The company also announced an increased quarterly dividend of $0.45 per share, up from $0.40, representing an annualized yield of 2.1%.
• Wells Fargo's stock price opened at $82.52 following its earnings release, reflecting a <% increase based on previous closing price of $78.92.

Wells Fargo & Company (NYSE:WFC)'s stock price gapped up prior to trading on Tuesday after the company announced better than expected quarterly earnings. The stock had previously closed at $78.92, but opened at $82.52. Wells Fargo & Company shares last traded at $82.15, with a volume of 6,338,809 shares changing hands.

The financial services provider reported $1.66 EPS for the quarter, topping analysts' consensus estimates of $1.55 by $0.11. The business had revenue of $21.44 billion during the quarter, compared to analysts' expectations of $21.11 billion. Wells Fargo & Company had a net margin of 16.82% and a return on equity of 12.29%. The business's quarterly revenue was up 5.3% on a year-over-year basis. During the same period last year, the company posted $1.42 earnings per share.

Wells Fargo & Company Increases Dividend

The firm also recently disclosed a quarterly dividend, which was paid on Monday, September 1st. Stockholders of record on Friday, August 8th were issued a dividend of $0.45 per share. This is an increase from Wells Fargo & Company's previous quarterly dividend of $0.40. This represents a $1.80 dividend on an annualized basis and a dividend yield of 2.1%. The ex-dividend date was Friday, August 8th. Wells Fargo & Company's dividend payout ratio is 30.82%.

Analyst Ratings Changes

A number of research analysts have recently issued reports on WFC shares. Citigroup lifted their price objective on shares of Wells Fargo & Company from $85.00 to $90.00 and gave the company a "neutral" rating in a report on Tuesday, September 23rd. The Goldman Sachs Group reduced their price objective on shares of Wells Fargo & Company from $92.00 to $91.00 and set a "buy" rating for the company in a report on Wednesday, July 16th. Evercore ISI lifted their price objective on shares of Wells Fargo & Company from $94.00 to $98.00 and gave the company an "outperform" rating in a report on Tuesday, September 30th. Raymond James Financial cut shares of Wells Fargo & Company from a "strong-buy" rating to a "market perform" rating in a report on Monday, July 7th. Finally, UBS Group cut their price target on shares of Wells Fargo & Company from $95.00 to $93.00 and set a "buy" rating on the stock in a report on Tuesday, October 7th. Nine analysts have rated the stock with a Buy rating and eight have issued a Hold rating to the company. Based on data from MarketBeat.com, the company has a consensus rating of "Moderate Buy" and a consensus target price of $85.41.

Institutional Trading of Wells Fargo & Company

Several hedge funds have recently added to or reduced their stakes in the stock. Livforsakringsbolaget Skandia Omsesidigt raised its position in Wells Fargo & Company by 2,735,254.3% in the second quarter. Livforsakringsbolaget Skandia Omsesidigt now owns 949,769,723 shares of the financial services provider's stock worth $76,095,550,000 after acquiring an additional 949,735,001 shares during the period. Vanguard Group Inc. raised its position in Wells Fargo & Company by 0.4% in the second quarter. Vanguard Group Inc. now owns 302,092,955 shares of the financial services provider's stock worth $24,203,688,000 after acquiring an additional 1,341,222 shares during the period. Norges Bank bought a new stake in Wells Fargo & Company in the second quarter worth about $3,990,551,000. Dimensional Fund Advisors LP raised its position in Wells Fargo & Company by 0.6% in the first quarter. Dimensional Fund Advisors LP now owns 20,497,429 shares of the financial services provider's stock worth $1,471,259,000 after acquiring an additional 128,207 shares during the period. Finally, Massachusetts Financial Services Co. MA raised its position in Wells Fargo & Company by 54.9% in the second quarter. Massachusetts Financial Services Co. MA now owns 16,635,681 shares of the financial services provider's stock worth $1,332,851,000 after acquiring an additional 5,894,747 shares during the period. Institutional investors own 75.90% of the company's stock.

Wells Fargo & Company Trading Up 6.2%

The firm has a market cap of $268.36 billion, a P/E ratio of 14.34, a price-to-earnings-growth ratio of 1.25 and a beta of 1.25. The company has a quick ratio of 0.83, a current ratio of 0.84 and a debt-to-equity ratio of 1.06. The firm's 50-day simple moving average is $80.66 and its 200 day simple moving average is $76.61.

Wells Fargo & Company Company Profile

Wells Fargo & Co is a diversified and community-based financial services company, which engages in the provision of banking, insurance, investments, mortgage, and consumer and commercial finance products and services. It operates through the following segments: Consumer Banking and Lending, Commercial Banking, Corporate and Investment Banking, and Wealth and Investment Management.

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