For several months I’ve been telling investors to avoid financial stocks. One of the few that I’ve liked has been Wells Fargo (WFC).
Today, the bank said it expects to reports earnings of $3 billion or 55 cents a share. The Street was only expecting 23 cents a share. That’s a big surprise. As a result, the shares are up strongly this morning.
What’s behind the turnaround? One factor seems to be home refinancing. The bank did $100 billion in mortgage originations during the quarter. That’s over 450,000 people who are either purchasing or refinancing a home.
This is impressive news and we may see more it going forward.