Wells Fargo says its profit topped Wall Street estimates in Q4

Wells Fargo & Co. (NYSE: WFC) said on Friday that its profit in the fiscal fourth quarter came in better than expected. But its revenue slid more than what analysts had anticipated in Q4. The bank said that its net interest income took a hit due to COVID-19 driven lower interest rates.

Wells Fargo slid a little under 5% in premarket trading on Friday. Including the price action, the U.S. bank is now trading at £24.36 per share versus a significantly lower £15.50 per share in the last week of October. Learn more about how do people make money on the stock market.

Wells Fargo’s Q4 financial results versus analysts’ estimates

Wells Fargo reported £2.19 billion of net income in the recent quarter that translates to 46.84 pence per share. In comparison, its net income was capped at a lower £2.10 billion in the same quarter last year or 43.91 pence per share.

In terms of revenue, the financial services company recorded £13.12 billion in the fourth quarter that represents a 9.7% annualised decline. According to FactSet, experts had forecast the bank to post a higher £13.26 billion of revenue in Q4. Their estimates for per-share earnings stood at a lower 43.18 pence.

In related news from the United States, peer Citigroup Inc. also published its financial results for the fiscal fourth quarter on Friday.

Other prominent figures in Wells Fargo’s earnings report

At £6.79 billion, Wells Fargo’s net interest income saw a 17% year over year decline in the fourth quarter versus £6.85 billion expected. Other prominent figures in the American multinational’s earnings report on Friday include a 5% decline in revenue from consumer banking and lending to £6.30 billion.

Chief Executive Charlie Scharf commented on the quarterly report on Friday and said:

“Although our financial performance improved and we earned £2.20 billion in the fourth quarter, our results continued to be impacted by the unprecedented operating environment and the required work to put our substantial legacy issues behind us.”

On Thursday, CEO Scharf said he will disclose further details regarding the expected turnaround plan later this week.

Wells Fargo performed largely downbeat in the stock market last year with an annual decline of more than 40%. At the time of writing, the New York-based bank is valued at £105.14 billion and has a price to earnings ratio of 93.50.