Wells Fargo & Co (NYSE: WFC) has posted mixed results in the second quarter of FY 17 leading to the stock fall of over 2.6% this morning (as of 10:50AM EDT on July 14th, 2017; Source: Google finance)
The bank has posted a 4.5 percent rise in second-quarter profit, due to the loan growth and higher interest rates. WFC has posted $5.8 billion of net income in the second quarter. The quarter included the discrete tax benefits of $186 million, due to the agreement to sell Wells Fargo Insurance Services.
WFC in the second quarter of FY 17 has reported the adjusted earnings per share of $1.07, beating the analysts’ estimates for the adjusted earnings per share of $1.01 according to Thomson Reuters. The company had reported the adjusted revenue growth flat to $22.2 billion in the second quarter of FY 17, missing the analysts’ estimates for revenue of $22.47 billion.
WFC has returned $3.4 billion to shareholders through common stock dividends and net share repurchases for a net payout ratio of 63 percent in the second quarter. In addition, during the quarter the bank has got a non-objection from the Federal Reserve to the 2017 Capital Plan. As per the plan, there included an increase in the quarterly common stock dividend rate in third quarter 2017, to $0.39 per share from $0.38 per share. The plan also includes up to $11.5 billion of gross common stock repurchases, for the four-quarter period from third quarter 2017 through second quarter 2018. These are subject to the company’s board approval.
Additionally, in the second quarter, a Common Equity Tier 1 ratio (fully phased-in) is of 11.6 percent, compared with 11.2 percent in the prior quarter. The total average deposits for second quarter 2017 were $1.3 trillion, stable from the prior quarter, due to the growth in consumer and small business deposits, which was offset by lower commercial deposits. The total average loans is of $956.9 billion in Q2 2017, up 1 percent.
WFC stock has risen 10.7% in the last one year (source: Google Finance).