Wells Fargo Profits Drop Amid Legal Expenses, Lower Rates

Andrew Cummings
January 16, 2020

Boston Trust Walden Corp's holdings in Wells Fargo & Co were worth $977,000 as of its most recent filing with the Securities and Exchange Commission. Nuveen Asset Management LLC raised its position in shares of Wells Fargo & Co by 10,041.9% during the 2nd quarter. DNB Asset Management AS now owns 634,105 shares of the financial services provider's stock worth $34,115,000 after buying an additional 115,667 shares during the last quarter. Finally, California Public Employees Retirement System increased its position in Wells Fargo & Co by 25.4% during the third quarter. Boston Partners now owns 21,203,872 shares of the financial services provider's stock worth $1,069,832,000 after purchasing an additional 1,417,096 shares during the last quarter. The company has a quick ratio of 0.85, a current ratio of 0.86 and a debt-to-equity ratio of 1.33. Wells Fargo & Co has a 52-week low of $43.34 and a 52-week high of $54.75.

Chief Executive Jamie Dimon said despite the "continued high level of complex geopolitical issues" facing the global economy, the "resolution of some trade issues helped support client and market activity towards the end of the year".

Bank of America reports fourth quarter earnings Wednesday.

Burke & Herbert Bank & Trust Co. lessened its stake in shares of Wells Fargo & Co (NYSE:WFC) by 2.3% in the 4th quarter, according to its most recent disclosure with the SEC. Combined with the bank's 3.9% dividend yield, it's fair to say that Wells Fargo is returning lots of capital to shareholders.

Total average deposits for the quarter were $1.3 trillion, up $53.0 billion from the prior quarter, primarily due to growth in both commercial and consumer deposits. During the same quarter in the prior year, the company earned $1.13 earnings per share.

Dimon highlighted China as a key growth market, noting that previous year it became the first U.S. bank to be approved for a majority-owned securities business in the country. To be clear, this was largely expected given the declining interest rate environment and is likely a big driver of Wells Fargo's lower profitability.

Several equities analysts have commented on the stock.

The inflation figures about to be released tomorrow might be restrained a bit by the appreciation of the pound over the month; however, the large run-up in oil prices in December might act as an offset, said Wells Fargo in a research report.

An 1860's era stagecoach is displayed at the Wells Fargo & Co. bank in downtown Denver, Colorado, U.S. April 13, 2016. Robert W. Baird downgraded shares of Wells Fargo & Co from a "neutral" rating to an "underperform" rating and set a $50.00 price target for the company.in a research report on Thursday, January 2nd.

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