The company shares initially jumped on Friday's pre-market trading session with more than 2%, after the overwhelmingly positive earnings report. Wells Fargo reported 1.20$ earnings per share beating the initial estimations for just 1.09$ EPS. The revenue stream also beat the initial forecast of 21.012$ billion with a final tally of 21.609$ billion, which resulted with an initial price jump of the company's stock with over 1 dollar, reaching 48.82 USD per share.
However, Wells Fargo CFO John Shrewsberry expressed concerns that the company's top analysts expect a fall in the overall revenue stream for the rest of 2019, owing to gloomy prospects for the net interest income to fall by 2%.
Despite benefiting positively from the same interest rate factor, mentioned above, Wells Fargo has been ravaged by internal disputes and external controversy, which ultimately was the reason why the company's recent CEO Tim Sloan decided to resign from his position (more on that you can read here).
For those reasons, the bank struggles to reap the benefit from the prevalent favourable economic circumstances and a lot of it goes to other more stable companies like JPMorgan Chase. John Shrewsberry attributed the prospects for shrinking of the net interest income partially to the stiff competition in the sector.
As a result, the price of the company reverted and closed the day's trading session with a total loss of -2.62%, falling from the day's high to as low as 48.06 USD per share, only to then close slightly above the 23.6% Fibonacci support level at 46.49 USD.
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