5 Best Bank Stocks To Buy Now

2. Wells Fargo & Company (NYSE:WFC)

Number of Hedge Fund Holders: 94

Wells Fargo & Company (NYSE:WFC) is a financial services company that provides a range of products and services, including banking, insurance, mortgage and leasing services, among numerous others. Ranked second on our list of the 15 best banks stocks to buy now, the California-based company has a market capitalization of $195.26 billion.

At the end of the second quarter of 2021, 94 hedge funds in the database of Insider Monkey held stakes worth $7.08 billion in Wells Fargo & Company (NYSE:WFC). This is compared to 96 hedge funds in the preceding quarter with stakes worth roughly $7.4 billion.

On September 1, Deutsche Bank analyst Matt O’Connor raised the price target of Wells Fargo & Company (NYSE:WFC) to $55 from $48 and kept a Buy rating on the shares of the company.

On July 14, Wells Fargo & Company (NYSE:WFC) issued its quarterly earnings report for the second quarter of 2021, with earnings per share declared at $1.37, crossing estimates by $0.44. Additionally, the revenue for the quarter came in at $20.27 billion, surpassing market predictions by $2.54 billion.

L1 Capital, in its second-quarter 2021 investor letter, mentioned Wells Fargo & Company (NYSE:WFC). Here is what the fund said:

“Wells Fargo (Long +16%) was the strongest contributor to portfolio performance over the quarter. Wells Fargo shares rallied given a better outlook for bad debts driven by improving employment and house price trends. The company had been very undervalued due to excessive fears around likely bad debts due to the pandemic, the continued regulatory “asset cap” (a punishment that was put in place in 2017 for numerous compliance failures) and an inability to commence buybacks. The share price has subsequently recovered strongly in recent months as the company has progressed its turnaround program under the leadership of the well-regarded CEO, Charles Scharf (former CEO of Visa and BNY Mellon). Wells Fargo is now closer to getting the asset cap lifted and has announced a huge cost out program (US$8b+) as well as an $18b buyback program to be completed over the next 12 months. Wells Fargo shares have rallied more than 50% since we initiated the position in late 2020. Given the strong rally, we elected to exit our position and rotate into stocks with larger valuation upside.”