Wells Fargo Stock Investors: Betting Big On The Bank
https://theconservativeincomeinvestor.com/wells-fargo-stock-investors-betting-big-on-the-bank/
“Right now, Wells Fargo is yielding over 4% (based upon a stock price of $49 per share). As part of the Fed’s limitations on its capital return policies, namely dividends and share repurchases, Wells Fargo is storing capital at a higher rate that will be unleashed in the future. It is positioning itself for long-term earnings per share growth of 7.5% with dividend hikes accordingly. For a yield that starts at slightly above 4%, high single-digit dividend growth and earnings per share growth over the long-term is likely to be a recipe for 10-12% annual returns. Given that Wells Fargo is already a trillion-dollar bank in terms of assets, that would be a colossal achievement. I expect that a day will come when all the heavy betters on Wells Fargo stock will have a period of sharp outperformance when the investor community wakes up and chooses to recognize that Wells Fargo and JP Morgan are coastal twins and deserve the same valuation.”