Keeb's princess pick takes a dive while other financials go up today. Words like "according to analysts.....according to analysts.....downgraded......" don't paint a pretty picture for Wells. Time to bring out the mop and broom and clean up the WFC mess:
NEW YORK (MarketWatch) -- Wells Fargo & Co. WFC -0.46% was downgraded to neutral from positive as the stock approaches its target price with no upside, said analysts at Susquehanna Financial Group LLP in a report on Tuesday. Wells Fargo shares have risen approximately 25% in the last year within 5% of the $45 target prices set by the analysts, who believe the bank is facing lower mortgage revenue for the remainder of 2013. As mortgage rates rise, firms like Wells Fargo will see a drop off in refi originations and margins, according to analysts.
Do you think you got me because USB was up today and WFC was down? What infantile behavior. You just show your lack of knowledge as an investor. You ignore the price appreciation of WFC over the long term, which exceeds that of USB for every time frame you care to look at... 5 days, 5 months, 5 years or whatever you choose. Do you also presume to know what my WFC cost basis is? Well, it is quite low, even with 100% re-investment of dividends. I admit to not trading WFC well but that's because it has been in an uptrend for a long time now, as billion pointed out.
Still, I admit it is bad form to criticize USB. I know there are many people who read this board who have a stake in USB. I vented my frustration and sold back in March. I should have left it at that. My opinion could also change quickly, like after one good quarter. But the fact remains, while USB excels at maintaining good efficiency and credit metrics, they have not been able to show revenue growth in any of their major business segments for several quarters running. How they are to fix that is not clear because of their limited prospects for organic growth or growth by acquisition. If they surprise in this area when they report their Q2 results, that should give them a good boost.
The article you posted about WFC is lame at best and misleading at worst. Look at the Sea King Alfalfa piece authored by "Regarded Solutions" and published today on the subject of mortgage revenue and earnings at WFC. If you can understand it. He explains that rising mortgage interest rates will tend to increase the share price of WFC, primarily because it will increase their interest rate margin and NIM is what really tells the way a bank stock will move in the market. Or, perhaps you haven't figure it out that rising interest rates tend to make banks more profitable.