Wells Fargo (WFC) Shares Trade Lower as Q3 Revenue Miss Overshadows Growth in Earnings
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Price: $60.63 -0.51%
Revenue Growth %: +0.6%
Financial Fact:
Service charges on deposit accounts: 1.37B
Today's EPS Names:
CP, RUSHA, SEIC, More
Revenue Growth %: +0.6%
Financial Fact:
Service charges on deposit accounts: 1.37B
Today's EPS Names:
CP, RUSHA, SEIC, More
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Shares of Wells Fargo & Company (NYSE: WFC) are lower early Monday after reporting third-quarter results which had both good and bad elements.
The banking giant reported net income of $4.1 billion, up from $3.3 billion from last year. Earnings per share were $0.72, up from $0.60 last year but in-line with the consensus of $0.72. EPS were up 3 percent from last quarter.
Revenue for the quarter was $19.6 billion, below the consensus of $20.21 billion.
"The economic recovery has been more sluggish and uneven than anyone anticipated," said Chairman and CEO John Stumpf. "We can't change the economic environment, yet we have worked hard to control the variables we can – making our products and services more relevant to individuals and businesses, focusing on the customer, making as many loans as possible and growing new relationships – as well as fostering longtime ones. We see the results of this focus in growing cross-sell, deposits, and loans. Customers need a trusted financial partner, especially in challenging economic times. Wells Fargo has proven to be that partner over and over again."
Net interest income in the quarter was $10.5 billion, down from $10.7 billion in second quarter of 2011. Noninterest income was $9.1 billion, compared with $9.7 billion in second quarter of 2011.
Noninterest expense was $11.7 billion, down $798 million from the second quarter of 2011 and down $576 million from a year ago.
Total loans were $760.1 billion at September 30, 2011, up $8.2 billion from $751.9 billion at June 30, 2011. Core loan portfolios up $13.4 billion from June 30, 2012.
Average core deposits were $836.8 billion, up 8 percent from a year ago and up 14 percent (annualized) from 2011's second quarter. Consumer checking accounts grew a net 5.6 percent from September 30, 2010.
Capital increased with Tier 1 common equity reaching $91.9 billion under Basel I, or 9.35 percent of risk-weighted assets. Under current Basel III proposals, the Tier 1 common equity ratio was an estimated 7.41 percent.
Third quarter net charge-offs were $2.6 billion, or 1.37 percent (annualized) of average loans, down $227 million from second quarter net charge-offs of $2.8 billion (1.52 percent). Nonperforming assets declined to $26.8 billion, down $1.1 billion from prior quarter; down $7.6 billion from prior year. Reserve release of $800 million (pre-tax) reflected improved portfolio performance.
Shares of Wells Fargo last traded down 3.64 percent to $25.70.
The banking giant reported net income of $4.1 billion, up from $3.3 billion from last year. Earnings per share were $0.72, up from $0.60 last year but in-line with the consensus of $0.72. EPS were up 3 percent from last quarter.
Revenue for the quarter was $19.6 billion, below the consensus of $20.21 billion.
"The economic recovery has been more sluggish and uneven than anyone anticipated," said Chairman and CEO John Stumpf. "We can't change the economic environment, yet we have worked hard to control the variables we can – making our products and services more relevant to individuals and businesses, focusing on the customer, making as many loans as possible and growing new relationships – as well as fostering longtime ones. We see the results of this focus in growing cross-sell, deposits, and loans. Customers need a trusted financial partner, especially in challenging economic times. Wells Fargo has proven to be that partner over and over again."
Net interest income in the quarter was $10.5 billion, down from $10.7 billion in second quarter of 2011. Noninterest income was $9.1 billion, compared with $9.7 billion in second quarter of 2011.
Noninterest expense was $11.7 billion, down $798 million from the second quarter of 2011 and down $576 million from a year ago.
Total loans were $760.1 billion at September 30, 2011, up $8.2 billion from $751.9 billion at June 30, 2011. Core loan portfolios up $13.4 billion from June 30, 2012.
Average core deposits were $836.8 billion, up 8 percent from a year ago and up 14 percent (annualized) from 2011's second quarter. Consumer checking accounts grew a net 5.6 percent from September 30, 2010.
Capital increased with Tier 1 common equity reaching $91.9 billion under Basel I, or 9.35 percent of risk-weighted assets. Under current Basel III proposals, the Tier 1 common equity ratio was an estimated 7.41 percent.
Third quarter net charge-offs were $2.6 billion, or 1.37 percent (annualized) of average loans, down $227 million from second quarter net charge-offs of $2.8 billion (1.52 percent). Nonperforming assets declined to $26.8 billion, down $1.1 billion from prior quarter; down $7.6 billion from prior year. Reserve release of $800 million (pre-tax) reflected improved portfolio performance.
Shares of Wells Fargo last traded down 3.64 percent to $25.70.
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