Wells Fargo posted a $3 billion first quarter net income, or 56 cents a share. This easily beat analyst estimates of only 23 cents a share. Wells Fargo attributed some of this to its acquisition of Wachovia Bank.
Although the legislation associated with the TARP funding does not apply to WFC current foreign employees, the company had decided not to renewmany of the foreign work visas. This means that it will be laying off many of its current foreign workers in the following 18months.
Wells Fargo's Q4 loss increased from 79 cents to 84 cents per share due to a $328.4 million non-cash charge arising from investments in a number of perpetual preferred securities.
WFC posted a quarterly loss of $2.6 billion, which was less than what analysts expected. The loss was due to WFC's recent acquisition of Wachovia and various other credit write-downs.
As a result of the government takeover of Fannie Mae and Freddie Mac, Wells Fargo announced that it expects to post a write down on securities backed by the two mortgage giants.
On Wednesday, July 16, Wells Fargo reported net income of $1.75 billion for 2Q08, down 23% from the same quarter in 2007. Despite the fall in its net income, Wells Fargo beat consensus analyst expectations and raised its quarterly dividend by 10%.
Analyst opinions that the subprime mortgage market had essentially bottomed out gave WFC an upward push. A prevalent opinion was that with the shadier lenders already out of business from the harsh conditions, the remaining mortgage providers (including Wells Fargo) were setting stricter lending standards to protect their loans and minimize the risk of credit losses.
Wells Fargo stock shot up when the company announced its earnings for 1Q 2007. Profit in the first quarter increased 11% to $2.24 billion, compared to $2.02 billion for the previous year.
WFC stock increased in response to news that Wells Fargo is beating its home mortgage competitors. Although Wells Fargo took revenue losses as the housing bubble deflated and subprime mortgage borrowers defaulted in droves, the company showed better results than most competitors, many of which went out of business entirely.