Wells Fargo (NYSE:WFC) gained in pre-market trading after the bank announced first-quarter results that beat estimates. The bank generated total revenues of $20.86 billion, inching up by 1% year-over-year, and was above consensus estimates of $20.15 billion. Wells Fargo reported Q1 earnings of $1.20 per diluted share as compared to $1.23 per share in the same period last year. This surpassed analysts’ expectations of $1.11 per share.
However, WFC’s Q1 results showed a decline in its interest income. The bank’s net interest income dropped by 8% year-over-year to $12.23 billion in Q1.
The bank’s net interest income was impacted by higher interest rates, which adversely affected funding costs, and by customers migrating to deposit products with a higher yield. The company’s management stated that investments across its businesses boosted its revenue from non-interest sources, making up for the decline in net interest income.
Is WFC Stock a Buy or Sell?
Analysts remain cautiously optimistic about WFC stock, with a Moderate Buy consensus rating based on nine Buys and 10 Holds. Over the past year, WFC stock has soared by more than 45%, and the average WFC price target of $55.91 implies a downside potential of 1.4% from current levels. However, these analyst ratings are likely to change following WFC’s earnings today.
