Market Opinion Mixed On Timing Of Wells Fargo Bounce Back

Wells Fargo & Co WFC has been under heavy scrutiny after the scandal broke that the company opened up over 2 million fake accounts. Democratic presidential nominee Hillary Clinton chimed in and said she was "deeply disturbed" by Wells Fargo illegal practices in an open letter to its customers on her website.

"Gutless leadership" is how Sen. Elizabeth Warren described Wells Fargo CEO John Stumpf's actions in front the Senate Banking Committee on Tuesday. Since the scandal broke earlier in the month, Wells Fargo stock is down nearly 8 percent.

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JPMorgan downgraded Wells Fargo to Neutral following the tough senate hearings "and mounting public scrutiny following the opening of fraudulent accounts."

"We expect these will result in additional investigations which would likely pressure expenses and revenues and continued media scrutiny with an election year," the bank said.

Morgan Stanley had a different take and feels that Wells Fargo's stock is now inexpensive, subsequently raising its rating to Overweight with an attached $53 dollar price target. "Wells is rarely this inexpensive. This is an opportunity," Morgan Stanley analysts wrote.

Some have felt that the relatively low fine for the bank, which has $1.8 trillion in assets, is just a blip on the radar. However, since the banking crisis in 2008, its common knowledge how difficult it is to improve public opinion about a bank when it has soured.

At time of publication, Wells Fargo was seen trading at $45.73, down 1.78 percent on Wednesday.

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