Wells Fargo's Q4 Results Impress, Analysts Weigh In On Growth, Expense Outlook

Wells Fargo & Co's WFC fourth-quarter results sent banking stocks surging on Wednesday.

The company reported its quarterly results amid an exciting earnings season. Here are some key analyst takeaways.

Keefe, Bruyette & Woods On Wells Fargo

Analyst David Konrad maintained a Market Perform rating, while raising the price target from $81 to $86.

The highlight of Wells Fargo's performance in the fourth quarter was the 4% sequential growth in non-interest-bearing deposits, "which funded modest loan growth as well as reduced borrowings," Konrad said in a note. The company is "transitioning from cutting costs to revenue growth," he added.

What won the day was Well Fargo's NII (net interest income) growth outlook for 2025 of between 1% and 3%, which was much better than expected, the analyst stated. He raised his earnings estimates for 2025, 2026 and 2027 by 16 cents to $5.80 per share, by 15 cents to $7.00 per share and by 20 cents to $8.15 per share, respectively.

Check out other analyst stock ratings.

Goldman Sachs On Wells Fargo

Analyst Richard Ramsden reaffirmed a Buy rating, while lifting the price target from $77 to $83.

Although Wells Fargo reported its fourth-quarter earnings at $1.43 per share, beating consensus of $1.36 per share, its core earnings, after excluding one-time items, missed expectations, Ramsden said.

Despite projecting NII growth, management guided to expenses of $54.2 billion for 2025, which represents a decline of around $400 million versus last year and missed the Street's expectations of $54.4 billion, the analyst stated. "Absolute $ expense reductions were attributed to lower operating losses, lower severance expense, and efficiency gains, partially offset by higher revenue-related expense and higher investments, including in technology," he further wrote.

Truist Securities On Wells Fargo

Analyst John McDonald reiterated a Buy rating and price target of $82.

Wells Fargo's 2025 NII growth outlook reflects sequentially flat net interest income in the first half of the year, despite two fewer days in the first quarter, McDonald said. Sequential growth is expected in the back half, he added.

The outlook assumes up to two interest rate cuts by the Federal Reserve as well as low-to-mid single-digit percentage average loan growth, which is expected to pick up in mid-2025, the analyst stated. "Management expects absolute growth in consumer deposits in 2025, with product mix also expected to stabilize alongside continued slowdown in pricing pressures," he further wrote.

WFC Price Action: Shares of Wells Fargo was down 0.75% to $75.38 at the time of publication on Thursday.

Read Next: