Wells Fargo to report Q3 results

Wells Fargo will report its third-quarter figures on Tuesday 14 October. The consensus is for revenue of $21.1 billion and earnings per share of $1.02.

Wells Fargo logo in window
Source: Bloomberg

Wells Fargo is trading at $52.03. The stock is broadly unchanged since the company reported its second-quarter figures in July, when revenue and EPS came in at $21.29 billion and $1.01 respectively, both exceeding estimates. Wells Fargo is the largest provider of mortgages in the US but, in the recent quarter, mortgage division suffered a 46% decline in income, and mortgages for new homes dropped by two thirds — the lowest level since the credit crunch.

The bank is continuing to cut costs but it was the lower tax bill and boost in its equity investments that more than offset the drop in mortgage lending. This quarter, traders will be focused on the mortgage business. One-off items like the drop in the tax bill ensured the banks exceeded expectations but these are unlikely to reoccur.

Equity analysts are quietly bullish on the company. Out of the 35 recommendations, 17 are buys, 16 are holds and two are sells.

The stock reached record highs this year and is receiving support from the 50-week moving average of $48.55. If the figures are higher than expected, it could target $55, but if mortgages continue to be weak it could drop to $49.37.

The information on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG Bank S.A. accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it and as such is considered to be a marketing communication.

Find articles by analysts