Wells Fargo, which is another prominent financial institution in the US, reported much weaker quarterly earnings than initially expected, completely missing the consensus forecasts.
The company reported diluted Earnings Per Share of $0.01 for Q1 2020, a drop from the $0.60 that was published for Q4 2019. Compared to Q1 of 2019, when WF recorded EPS of $1.20, the company's performance over the last period is drastically weaker.
Wells Fargo’s net income dropped by nearly 90 per cent to $653 last quarter, which is owing to the severe hit to the company from the coronavirus fallout. The revenue was reported at $17.71 billion vs $19.28 billion.
Overall, Wells Fargo’s quarterly performance elucidated the company’s vulnerability to the economic tribulations currently ravaging the American financial system, unlike JPMorgan Chase & Co., which demonstrated more resilience to the ongoing economic turmoil.
Chief Executive Officer Charlie Scharf commented on the recorded performance:
“We have taken comprehensive steps to help customers, employees and communities. For our customers, we’ve suspended residential property foreclosure sales, offered fee waivers, and provided payment deferrals, among other actions. For example, starting in early March and continuing into last week, we helped more than 1.3 million consumer and small business customers by deferring and waiving fees.”
The company’s share price tumbled by almost 4 per cent during yesterday’s trading session on the news of its deteriorated interest margins.
Nevertheless, the price action continues to be threading within the boundaries of an upwards-sloping channel, which gives investors glimmers of hope for a quick correction.
WFC 1H Price Chart. Image source: Trendsharks ©, created with TradingView.com
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