OT: Wells Fargo

Why it is this moment up 5%, in stark contrast to the rest of the market?

(I am just selling most of the very few stocks I have apart from Berkshire; just sold Vodafone & DLTR, was about to sell WFC, wondering now whether that might be the perfectly wrong moment to do so.)

Barclays upgrades WFC.


Seeking Alpha is a good free site for news, earnings transcripts, financials and occasionaly some good analysis.

Though I did look for a moment for WFC news I did not found this.

rnam, thank you.

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Why it is this moment up 5%, in stark contrast to the rest of the market?
All banks are up and TLT is down… WFC is slightly up as they are more levered to benefit from raising rates.

Separately, unless you have a reason to sell, I will sit tight. Expect WFC to buyback at least 200 million and depending on few things as much as 300 million share. You are entering a golden era for Banks, economy will continue to grow, a slight inverted yield curve ( I am not expecting huge rate increase, may be 1% higher long-term rates and short-term only raising by 50%). WFC is spending more on compliance and eventually (may be by end of 2023?) to start ramping down, continuing to provide EPS momentum, and if FED ever lifts the asset cap, another momentum.

You are look at 500 million share buyback in the next 2 to 3 years and $6 ~ $7 EPS, and possibly the stock gets to trade with peers (i.e., close to 2x BV multiple), leading to 50% return in 2 to 3 years.

Of course market will be volatile and you may get an opportunity to sell now and buy it back lower.


King, thank you for your thoughts.

(While I am reducing non-BRK exposure actually WFC as well as BASF and Bayer are the 3 stocks I am less sure about selling, even thinking of maybe holding them “forever”.)

Maybe time to upgrade your bank investment.

Toronto-Dominion Bank (NYSE:TD) is the largest bank in Canada and top 10 largest in North America. They are considered the safest Bank in North America with $1.1 T deposit and 126% liquidity coverage ratio. Toronto-Dominion has been the example of a steady and profitable company. They have been paying a dividend continuously over 165 years (current yield of 3.3%), and the dividend growth rate has been 11% CAGR over the past 25 years. Toronto-Dominion is an excellent choice for the long-term investor with a strong interest for steady dividend growth.

Toronto-Dominion just had stellar 4Q results. Their EPS was C$2.09 against the consensus estimate of C$1.95, and their revenue was C$10.94 B against the consensus estimate of C$9.9 B. Their Canadian retail segment reported 8% revenue increase YoY, and net income up 19% YoY. The U.S. retail segment also performed well, and the segment reported 8% revenue increase YoY and 66% net income increase. The wholesale segment reported strong earnings of $420 M, although net income was down 14% YoY.

Most importantly, their return on tangible common equity returned to its pre-pandemic level of 21.2%, after dipping to 18.7% during the pandemic. Overall, it was pretty clear that Toronto-Dominion, and more broadly Canadian banks in general, is exiting the pandemic in very strong fashion.


Not mentioned in the article is TD’s 13.5% ownership of Charles Schwab after Schwab acquired TD Ameritrade last year.