WFC
Wells Fargo & Company$80.42
Sell
Target $62.02
Report: Mar 13, 2026Financial Services • Banks - Diversified • Mature CompounderSnapshot
Decision-first overview with recommendation, valuation anchor, and current setup.
Company Overview
Research Snapshot
Price History
Pelican View
Current$80.42-22.9%
Rec: SellConviction: High
Entry Target
N/A
N/A
Fair Value
$62.02
(23% below current)
Stop Loss
N/A
N/A
Position Size
None
Time Horizon
N/A
Key Metrics
Live Snapshot
Market Data
52 Week High$97.76
52 Week Low$58.42
Avg. 3 Month Volume17.29M
Efficiency
LTM Gross Margin100.0%
LTM EBITDA Margin39.3%
LTM EBIT Margin30.1%
LTM Operating Margin30.1%
LTM ROA1.0%
LTM ROE11.2%
LTM ROIC1.1%
LTM ROCE1.2%
Capital Structure
Market Cap (MM)$245.6B
Enterprise Value (MM)$497.2B
Shares Outstanding3.11B
Total Debt (MM)$425.72B
Cash & Equivalents (MM)$174.21B
LTM Net Debt (MM)$251.51B
LTM Net Debt/EBITDA7.6x
Growth
TTM Rev. Growth1.7%
Last 3-Yr Rev. CAGR4.3%
Last 3-Yr EBITDA CAGR14.2%
Last 3-Yr EPS CAGR25.9%
Valuation
Street Target Price$98.75
LTM EV/Revenue5.9x
LTM EV/Gross Profit5.9x
LTM EV/EBIT19.7x
LTM EV/EBITDA15.1x
LTM P/E12.1x
LTM EV/FCF-26.2x
LTM P/FCF-12.9x
LTM P/TB0.1x
LTM P/B1.4x
Dividend Yield2.2%
Payout Ratio27.6%
Executive SummarySituation: Current price is $80.42 versus fair value $62.02 (-22.9% expected return), and valuation confidence is stable. Debate: Bull case depends on Scrutiny of Cash Flow Quality: As investors digest the FY2025 annual report, the $19 billion gap between net income and operating cash flow will likely trigger a re-evaluation of earnings sustainability. Bear case centers on Upside Risk: Accelerated Investment Banking Growth. Conclusion: Recommendation is Sell with no position, pending a materially better risk/reward setup.
Bull Case
The lifting of the asset cap enables a 50% expansion in trading-related assets and a 25% surge in investment banking fees. Management's 17-18% ROTCE target is achievable through continued efficiency gains and a $2.4 billion gross expense reduction target for 2026.
Bear Case
Earnings quality is severely compromised, evidenced by a negative $19 billion operating cash flow swing in FY2025. The company is trapped in a low-growth regime (1.7% revenue growth) with an incremental ROIC of 0.7%, far below its 10% cost of capital.
Key Catalysts
Near-Term (0-6 months)Impact: High
Scrutiny of Cash Flow Quality: As investors digest the FY2025 annual report, the $19 billion gap between net income and operating cash flow...
Mid-Term (6-18 months)Impact: Moderate
Net Interest Income (NII) Compression: A cycle of interest rate cuts by the Federal Reserve will likely squeeze NII as deposit costs remain...
Long-Term (18+ months)Impact: Moderate
Wells Fargo is at a critical juncture following the 2025 asset cap removal; the market has fully priced in the 'recovery' phase, making the...
Primary Risks
Concern: Medium
Upside Risk: Accelerated Investment Banking Growth. If the CIB division captures market share faster than expected, fee-based revenue could...
Concern: High
Solvency Risk from Leverage: The 220% increase in net debt to $251B could impair the bank's ability to withstand a severe economic downturn.
Concern: Medium
The stewardship verdict is mixed. While the board possesses deep risk management expertise (e.g., Mark Chancy and Suzanne Vautrinot), they h...
Recent Activity
2025-10-14SEC Filing (8-K)
+7.15%Wells Fargo reports third quarter 2025 net income of $5.6 billion, or $1.66 per diluted share.
2025-07-15SEC Filing (8-K)
-5.48%Wells Fargo reports second quarter 2025 net income of $5.5 billion, or $1.60 per diluted share.
2025-01-15SEC Filing (8-K)
+6.69%Wells Fargo reported Q4 2024 net income of $5.1 billion, or $1.43 per diluted share, with full-year net income of $19.7 billion.
2024-10-11SEC Filing (8-K)
+5.61%Wells Fargo reports third quarter 2024 net income of $5.1 billion, or $1.42 per diluted share.
2024-07-12SEC Filing (8-K)
-6.02%Wells Fargo reported Q2 2024 net income of $4.9 billion, or $1.33 per diluted share, with growth in fee-based revenue offsetting a decline in net interest income.
Valuation Table
9.8/10Decision Grade
Scenario Range
$38
Bear
$67
Base
$90
Bull
$80