Wells Fargo & Co. Earnings Cheat Sheet: Profitable Quarter Accelerates Growth

S&P 500 (NYSE:SPY) component Wells Fargo & Co. (NYSE:WFC) reported its results for the third quarter. Wells Fargo provides financial services in mainly wholesale banking, mortgage banking, consumer finance, equipment leasing, agricultural finance and commercial finance.

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Wells Fargo Earnings Cheat Sheet for the Third Quarter

Results: Net income for the financial services rose to $4.06 billion (72 cents per share) vs. $3.34 billion (60 cents per share) in the same quarter a year earlier. This marks a rise of 21.6% from the year earlier quarter.

Revenue: Revenue was $19.6 billion last quarter.

Actual vs. Wall St. Expectations: WFC fell short of the mean analyst estimate of 73 cents per share. It fell short of the average revenue estimate of $20.22 billion.

Quoting Management: “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.We are nearing the completion of our three-year Wachovia integration process. To date, Regional Banking has now completed its store conversions and our retail stores are Wells Fargo coast-to-coast on a single platform. Thank you to every single team member who has been involved in this remarkable effort.”

Key Stats:

The company has now seen net income rise in three straight quarters. In the second quarter, net income rose 28.9% and in the first quarter, the figure rose 47.6%.

The company fell short of estimates last quarter after beating the mark the quarter before with net income of 70 cents versus a mean estimate of net income of 69 cents per share.

Looking Forward: Expectations for the company’s next quarter results are lower than they have been. Over the past sixty days, the average estimate for fourth quarter has fallen from 73 cents per share to 72 cents. For the fiscal year, the average estimate has moved up from $2.78 a share to $2.80 over the last ninety days.

Competitors to Watch: Bank of America Corp. (NYSE:BAC), JPMorgan Chase & Co. (NYSE:JPM), Citigroup Inc. (NYSE:C), U.S. Bancorp (NYSE:USB), PNC Financial Services (NYSE:PNC), SunTrust Banks, Inc. (NYSE:STI), KeyCorp (NYSE:KEY), Goldman Sachs Group, Inc. (NYSE:GS), Regions Financial Corp. (NYSE:RF), and Morgan Stanley (NYSE:MS).

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(Source: Xignite Financials)