Wells Fargo 5% move up on OCC news ‘seems a bit strong,’ says Citi

Citi analyst Keith Horowitz notes that Wells Fargo confirmed the termination of a 2016 OCC consent order related to sales practices, while pointing out that “this is not the consent order imposing the asset cap, but was cited by the Fed as part of the reason the asset cap was imposed.” While the firm doesn’t expect any material impact to EPS as a result of this termination, it does view the news as “a positive proof point” and highlights that Wells has now terminated six consent orders under CEO Charlie Scharf’s tenure and now has eight remaining consent orders outstanding. Though the firm says the stock being up over 5% on the news “seems a bit strong to us and we think more indicative of investor positioning,” it maintains Buy rating and $57 price target on Wells shares.