Wells Fargo & Co.
What Happened: "The U.S. economy has performed very well and remains strong," Scharf said, noting that lower inflation and unemployment position the economy favorably for 2025.
"We succeed when the country succeeds, so the incoming administration's support of U.S. businesses and consumers gives us optimism as we look forward," Scharf said.
He emphasized that a more business-friendly approach to policies and regulations under the Trump administration "should benefit the economy and our clients."
The comments came as Wells Fargo reported fourth-quarter earnings per share of $1.43, surpassing consensus estimates of $1.36, though core earnings missed expectations when excluding one-time items. The bank notably achieved 4% sequential growth in non-interest-bearing deposits, which helped fund modest loan growth and reduce borrowings.
Why It Matters: Looking ahead, Wells Fargo projected net interest income growth of 1-3% for 2025, surprising analysts positively. The bank expects absolute growth in consumer deposits and anticipates loan growth to accelerate by mid-2025, assuming up to two Federal Reserve interest rate cuts.
Keefe, Bruyette & Woods analyst David Konrad raised his price target from $81 to $86, noting the bank is "transitioning from cutting costs to revenue growth." Goldman Sachs maintained its Buy rating while increasing its target to $83, focusing on the bank's projected expense reduction to $54.2 billion for 2025.
The results contributed to a broader rally in banking stocks, with the Financial Select Sector SPDR Fund
