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Wells Fargo (WFC)
NYSE:WFC
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Wells Fargo
(NYSE:WFC)
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Rating:73Outperform
Price Target:
$104.00
â–²(16.53% Upside)
The score is driven primarily by solid profitability and a constructive earnings outlook (higher NII target, growth initiatives, and strong capital position). Offsetting factors are elevated leverage and notably weak TTM cash flow, while technicals are positive but not strongly overextended and valuation appears reasonable with a modest dividend yield.
Positive Factors
Profitability & Margins
Sustained high margins and strong TTM revenue growth reflect durable operating leverage across lending, wealth and markets businesses. Robust profitability supports reinvestment, capital returns and medium-term ROTCE targets, making earnings less dependent on short-term rate moves.
Regulatory relief and capital position
Removal of the Federal Reserve asset cap and a CET1 ratio around 10.6% materially restore balance-sheet optionality. This structural change enables sustained loan and deposit growth, greater capital deployment and a cleaner regulatory backdrop that supports longer-term ROTCE targets.
Balance-sheet and loan growth momentum
Consistent loan growth and expanding assets after regulatory constraints point to durable NII capacity expansion. Growing loan balances deepen client relationships, enhance fee cross-sell opportunities and provide a stable interest-earning base that supports medium-term net interest income targets.
Negative Factors
Weak cash generation
Persistent negative operating and free cash flows reduce internal funding for investments, dividends and buybacks. Over months this limits flexibility to fund technology and franchise initiatives without increasing leverage or trimming capital returns, making execution riskier.
Elevated leverage
A higher debt-to-equity ratio increases sensitivity to funding and interest-rate volatility and can constrain capital actions if adverse macro or underwriting events occur. Elevated leverage raises the bar for capital generation and heightens downside risk to CET1 and returns under stress.
Commercial real estate — office credit stress
Ongoing office-sector credit losses and lower coverage ratios signal structural asset-quality pressure from secular shifts in office demand. This persistent stress may require higher provisions, compress returns on commercial lending and constrain capital allocation over the medium term.
Wells Fargo (WFC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$280.16B
Dividend Yield1.8%
Average Volume (3M)12.48M
Price to Earnings (P/E)14.3
Beta (1Y)1.04
Revenue Growth-4.37%
EPS Growth26.41%
CountryUS
Employees215,367
SectorFinancial
Sector Strength70
IndustryBanks - Diversified
Share Statistics
EPS (TTM)1.62
Shares Outstanding3,139,084,500
10 Day Avg. Volume11,908,896
30 Day Avg. Volume12,483,155
Financial Highlights & Ratios
PEG Ratio1.08
Price to Book (P/B)1.34
Price to Sales (P/S)1.92
P/FCF Ratio79.29
Enterprise Value/Market Cap1.79
Enterprise Value/Revenue4.09
Enterprise Value/Gross Profit6.35
Enterprise Value/Ebitda15.83
Forecast
1Y Price Target
$98.25Price Target Upside10.08% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering17
EPS Forecast (FY)7.01
Revenue Forecast (FY)$88.48B
Wells Fargo Business Overview & Revenue Model
Company DescriptionWells Fargo & Company, a diversified financial services company, provides banking, investment, mortgage, and consumer and commercial finance products and services in the United States and internationally. It operates through four segments: Consumer Banking and Lending; Commercial Banking; Corporate and Investment Banking; and Wealth and Investment Management. The Consumer Banking and Lending segment offers diversified financial products and services for consumers and small businesses. Its financial products and services include checking and savings accounts, and credit and debit cards, as well as home, auto, personal, and small business lending services. The Commercial Banking segment provides financial solutions to private, family owned, and certain public companies. Its products and services include banking and credit products across various industry sectors and municipalities, secured lending and lease products, and treasury management services. The Corporate and Investment Banking segment offers a suite of capital markets, banking, and financial products and services to corporate, commercial real estate, government, and institutional clients. Its products and services comprise corporate banking, investment banking, treasury management, commercial real estate lending and servicing, equity, and fixed income solutions, as well as sales, trading, and research capabilities services. The Wealth and Investment Management segment provides personalized wealth management, brokerage, financial planning, lending, private banking, and trust and fiduciary products and services to affluent, high-net worth, and ultra-high-net worth clients. It also operates through financial advisors. Wells Fargo & Company was founded in 1852 and is headquartered in San Francisco, California.
How the Company Makes MoneyWells Fargo generates revenue primarily through interest income from loans and investments, as well as non-interest income from fees for services. Key revenue streams include interest earned on commercial and consumer loans, residential mortgages, and credit card lending. Additionally, the company earns fees from wealth management services, investment banking, and transaction services. Significant partnerships with various financial institutions and businesses enhance its product offerings and customer reach. Factors contributing to its earnings include the management of interest rates, loan demand, and the overall economic environment.
Wells Fargo Key Performance Indicators (KPIs)
Any
Average Loans by Segment
Shows the distribution of loan portfolios across various segments, indicating lending focus and potential exposure to credit risk or growth opportunities.
Shows the distribution of loan portfolios across various segments, indicating lending focus and potential exposure to credit risk or growth opportunities.
Data provided by:
The Fly
The FlyWells Fargo Earnings Call Summary
Earnings Call Date:Jan 14, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Apr 14, 2026
Earnings Call Sentiment Positive
The call highlights meaningful progress across profitability, revenue growth, capital returns and strategic transformation: strong full-year net income, EPS growth, improved ROTCE, loan and deposit growth, and continued cost-efficiency gains. Management provided constructive 2026 NII and business growth targets while also planning disciplined investments in technology, wealth and markets. Key challenges include near-term severance and higher operating investments driving expense growth, margin pressure if rates decline, and isolated credit stress in CRE office loans. On balance the company appears to be transitioning from constraint to growth with strong capital and clear priorities, while acknowledging execution and macro risks.Q4-2025 Updates
Positive Updates
Recordable Profitability and EPS Growth
Full-year net income of $21.3 billion and diluted EPS growth of 17% year-over-year; fourth-quarter net income ~$5.4 billion and Q4 diluted EPS of $1.62, up 13% YoY (ex-severance EPS $1.76).
Improved ROTCE and Mid-Term Target
Return on tangible common equity (ROTCE) rose to 15% in 2025 (vs. 8% in late 2020). Management set a new medium-term ROTCE target of 17%–18%.
Revenue Growth and Fee-Based Momentum
Fee-based (noninterest) revenue increased ~5% YoY (+$419 million); investment advisory and brokerage/asset-based fees grew (investment advisory +8%) supported by higher market valuations and accelerating net asset flows.
Net Interest Income Expansion and 2026 Outlook
Net interest income (NII) of $47.5 billion in 2025; company expects total NII of ~$50 billion in 2026 and NII ex-markets to rise from $46.7 billion in 2025 to approximately $48 billion in 2026; markets NII targeted at ~$2 billion in 2026.
Balance Sheet and Loan Growth
Average loans increased by $49.4 billion (about +5% YoY); period-end loans grew ~5% linked quarter (strongest linked-quarter growth since Q1 2020); assets up 11% YoY since lifting of asset cap, reflecting broad-based loan growth and increased trading assets.
Deposit Growth and Lower Funding Cost
Average deposits rose $23.9 billion YoY while average deposit costs declined ~29 basis points YoY; management expects mid-single-digit average deposit growth in 2026 with stronger growth in interest-bearing deposits.
Capital Returns and Capital Position
Returned $23 billion of excess capital in 2025: dividend per share up 13% and $18 billion of share repurchases during the year (including $5 billion in Q4). CET1 ratio remained strong at 10.6% (well above regulatory minimum + buffers).
Consumer Product Momentum
Opened nearly 3 million new credit card accounts in 2025 (+21% YoY) with card balances up ~6% YoY; auto loan balances up 19% YoY and auto originations more than doubled YoY; mobile active customers grew by ~1.4 million (+4% YoY); 50% of consumer checking accounts opened digitally.
Commercial & Capital Markets Progress
Investment banking fees up 11% for the full year; M&A ranking improved to 8th in 2025 (from 12th in 2024); trading-related assets increased ~50% in 2025 to support markets and client financing activities.
Expense Discipline and Efficiency Savings
Noninterest expense declined ~$174 million YoY in 2025; management delivered roughly $15 billion in gross expense savings over five years and expects ~ $2.4 billion gross expense reductions in 2026 while continuing targeted investments.
Negative Updates
Severance and Near-Term Charges
Fourth-quarter severance expense of $612 million (primarily for actions in 2026) and $908 million of severance in second half of 2025; Q4 severance lowered but remains a meaningful near-term headwind to EPS.
Expense Base Expected to Rise in 2026
Management expects noninterest expense to increase to approximately $55.7 billion in 2026 (from $54.8 billion in 2025) driven by ~$1.1 billion incremental technology, ~$800 million other investments, ~$800 million higher performance/benefit-related costs, and a ~$400 million higher FDIC assessment.
Margin Pressure and Rate-Change Headwinds
Guidance assumes 2–3 Fed rate cuts in 2026 which is a modest headwind to NII; growth in lower-margin markets financing assets may partially compress aggregate margins despite higher NII dollars.
Commercial Real Estate — Office Losses and Asset Quality
Commercial net loan charge-offs increased QoQ (commercial NCOs +4 bps QoQ) driven by commercial real estate losses predominantly in the office portfolio; nonperforming assets modestly increased QoQ and CRE office coverage in the Corporate Investment Banking portfolio declined to 10.1%.
Home Lending Contraction
Home lending revenue declined ~6% YoY due to lower loan balances; management continues to reduce the servicing portfolio (reduced servicing by $90 billion in 2025) and headcount in home lending down >50% over three years — signaling continued run-off of that business.
Volatility and Uncertainty in Fee Revenue
Certain fee lines (trading, investment advisory, underwriting) are volatile and sensitive to market conditions; management warns markets NII growth may be partially offset by lower noninterest income, making near-term revenue lumpy.
Allowance Coverage and Provisioning Dynamics
Allowance for credit losses for loans was relatively stable but coverage ratios declined modestly; management expects provision expense could rise in 2026 to set reserves for expected loan growth.
Capital Allocation Trade-offs and Uncertainty on Repurchases
While management returned significant capital in 2025, it expects share repurchases to be lower in 2026 as capital is optimized (target CET1 of ~10%–10.5%); balance-sheet growth and RWA expansion may constrain buybacks relative to 2025 levels.
Company Guidance
The company gave detailed 2026 guidance: total net interest income is expected to be about $50 billion (±), with markets NII growing to roughly $2 billion and NII excluding markets to about $48 billion (2025 NII was $47.5B and NII ex‑markets $46.7B); key assumptions include 2–3 Fed rate cuts and relatively stable 10‑year Treasury rates, with average loans and average deposits each expected to grow mid‑single digits from Q4 2025 to Q4 2026 (Q4 tailwind/headwind and a Q1 decline in NII due to 2 fewer days noted). On expenses, 2026 noninterest expense is projected at ≈$55.7 billion (2025: $54.8B), reflecting ~ $2.4 billion of gross expense reductions from efficiency initiatives offset by ~$1.1 billion of incremental technology spend, ~$800 million of higher Wealth & Investment revenue‑related expenses, ~$800 million of other investments/merit, and a ~$400 million higher FDIC assessment (and an expected ~$700 million reduction in severance versus 2025); first‑quarter personnel costs are seasonally higher by about $700 million. Capital and returns targets were reiterated: CET1 managed to ~10.0–10.5% (Q4 CET1 10.6%), ROTCE of 17–18% medium term (2025 ROTCE was 15%), and capital actions will be more measured in 2026 (repurchases down from $18B in 2025 and $5B in Q4 as excess capital optimization continues).Wells Fargo Financial Statement Overview
Summary
Profitability is strong (TTM revenue growth 18.9%, gross margin 64.5%, net margin 17.2%), but the balance sheet shows higher leverage (TTM debt-to-equity 2.25) and cash generation is a key weakness with negative operating and free cash flows in the TTM.Income Statement
Wells Fargo has demonstrated strong revenue growth with a TTM (Trailing-Twelve-Months) revenue growth rate of 18.9%. The gross profit margin is robust at 64.5%, and the net profit margin has improved to 17.2%. The EBIT and EBITDA margins are healthy, indicating efficient operations. However, the slight decline in revenue from 2024 to 2025 suggests potential challenges in maintaining growth momentum.85
Very Positive
Balance Sheet
The company's debt-to-equity ratio has increased to 2.25 in the TTM, indicating higher leverage, which could pose risks if interest rates rise. Return on equity remains solid at 11.7%, reflecting effective use of equity. The equity ratio is stable, suggesting a balanced asset structure, but the increased debt levels warrant caution.75
Positive
Cash Flow
Wells Fargo's cash flow situation is concerning, with negative operating and free cash flows in the TTM. The free cash flow growth rate is positive, but the operating cash flow to net income ratio is negative, indicating potential liquidity issues. The company needs to improve its cash flow management to ensure long-term sustainability.60
Neutral
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 122.31B | 125.40B | 115.34B | 83.44B | 83.08B | 82.23B |
| Gross Profit | 78.82B | 77.96B | 77.20B | 72.83B | 83.32B | 60.13B |
| EBITDA | 31.63B | 30.92B | 27.91B | 22.46B | 37.45B | 10.72B |
| Net Income | 21.06B | 19.72B | 19.14B | 13.68B | 22.11B | 3.38B |
Balance Sheet | ||||||
| Total Assets | 2.06T | 1.93T | 1.93T | 1.88T | 1.95T | 1.95T |
| Cash, Cash Equivalents and Short-Term Investments | 380.45B | 363.46B | 362.61B | 272.75B | 411.47B | 485.00B |
| Total Debt | 408.42B | 281.88B | 297.15B | 226.01B | 195.10B | 271.95B |
| Total Liabilities | 1.88T | 1.75T | 1.75T | 1.70T | 1.76T | 1.77T |
| Stockholders Equity | 181.15B | 179.12B | 185.74B | 180.23B | 187.61B | 184.68B |
Cash Flow | ||||||
| Free Cash Flow | -14.22B | 3.04B | 40.36B | 27.05B | -11.53B | 2.05B |
| Operating Cash Flow | -14.22B | 3.04B | 40.36B | 27.05B | -11.53B | 2.05B |
| Investing Cash Flow | -103.39B | -15.65B | 16.04B | -42.48B | -7.62B | 122.55B |
| Financing Cash Flow | 106.00B | -21.53B | 20.49B | -59.65B | -11.24B | -1.24B |
Wells Fargo Technical Analysis
Negative
89.25
Price Trends
89.78
Negative
86.03
Positive
80.14
Positive
Market Momentum
0.98
Positive
38.79
Neutral
23.67
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For WFC, the sentiment is Negative. The current price of 89.25 is below the 20-day moving average (MA) of 94.11, below the 50-day MA of 89.78, and above the 200-day MA of 80.14, indicating a neutral trend. The MACD of 0.98 indicates Positive momentum. The RSI at 38.79 is Neutral, neither overbought nor oversold. The STOCH value of 23.67 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for WFC.
Wells Fargo Risk Analysis
Wells Fargo disclosed 27 risk factors in its most recent earnings report. Wells Fargo reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Wells Fargo Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $279.85B | 17.26 | 8.66% | 4.14% | -9.54% | -22.46% | |
77 Outperform | $83.16B | 12.25 | 11.69% | 3.77% | 2.91% | 33.77% | |
75 Outperform | $838.10B | 15.38 | 16.06% | 1.79% | 1.89% | 12.32% | |
73 Outperform | $280.16B | 14.26 | 11.85% | 1.80% | -4.37% | 26.41% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
65 Neutral | $383.23B | 13.77 | 10.23% | 1.93% | 0.15% | 33.84% | |
60 Neutral | $201.13B | 16.08 | 6.72% | 1.94% | -0.62% | 105.57% |
* Financial Sector Average
WFC
Wells Fargo
89.25
14.92
20.07%
BAC
Bank of America
52.48
6.90
15.14%
C
Citigroup
112.41
36.02
47.15%
HSBC
HSBC Holdings
81.76
33.61
69.81%
JPM
JPMorgan Chase
307.87
58.71
23.56%
USB
US Bancorp
53.50
7.06
15.19%
Wells Fargo Corporate Events
Business Operations and StrategyStock BuybackFinancial DisclosuresRegulatory Filings and Compliance
Wells Fargo posts strong Q4 results, boosts outlook
Positive
Jan 14, 2026
On January 14, 2026, Wells Fargo reported fourth-quarter 2025 net income of $5.4 billion, or $1.62 per diluted share, and $5.8 billion, or $1.76 per share, excluding a $612 million severance charge. Quarterly revenue rose to $21.3 billion from $20.4 billion a year earlier, while noninterest expense declined slightly and provision for credit losses eased to $1.04 billion. Average loans increased to $955.8 billion and average deposits to $1.38 trillion, driven by growth across consumer, commercial, corporate and investment banking, and wealth and investment management segments, with notable double-digit year-over-year loan and deposit growth in corporate and investment banking and in wealth and investment management. The bank reported a return on equity of 12.3% and return on tangible common equity of 14.5%, repurchased 58.2 million shares worth $5.0 billion in the quarter, and highlighted the 2025 removal of the Federal Reserve’s asset cap and the termination of multiple consent orders as strengthening its regulatory standing and supporting a higher medium-term ROTCE target of 17–18%.
The most recent analyst rating on (WFC) stock is a Buy with a $113.00 price target. To see the full list of analyst forecasts on Wells Fargo stock, see the WFC Stock Forecast page.
Business Operations and StrategyPrivate Placements and Financing
Wells Fargo Announces Redemption of Debentures
Neutral
Dec 12, 2025
On December 12, 2025, Wells Fargo announced the redemption of its Floating Rate Junior Subordinated Deferrable Interest Debentures due January 15, 2027, with the optional prepayment date set for January 15, 2026. This redemption will remove a covenant that previously restricted Wells Fargo’s ability to repurchase or redeem its 3.90% Fixed Rate Reset Non-Cumulative Perpetual Class A Preferred Stock, Series BB, potentially impacting the company’s financial flexibility and stakeholder interests.
The most recent analyst rating on (WFC) stock is a Buy with a $104.00 price target. To see the full list of analyst forecasts on Wells Fargo stock, see the WFC Stock Forecast page.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.