5 Stocks to Invest In According to Adam Peterson’s Magnolia Capital Fund

2. Wells Fargo & Company (NYSE:WFC)

Peterson’s Stake Value: $155,646,000
Percentage of Adam Peterson’s 13F Portfolio: 19.34%
Number of Hedge Fund Holders: 94

On September 1, Deutsche Bank analyst Matt O’Connor initiated coverage of Wells Fargo & Company (NYSE:WFC) raising his price target to $55 from $48 and maintained a “Buy” rating on the shares.

The hedge fund managed by Adam Peterson owns 3.44 million shares in Wells Fargo & Company (NYSE:WFC) worth over $155.65 million, representing 19.34% of their portfolio. Martin Taylor’s Crake Asset Management is the most significant shareholder of Wells Fargo & Company (NYSE:WFC) with 1.14 million shares worth $51.59 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.”