UPDATE: BMO Capital Markets Reiterates Market Perform Rating, Raises PT on Wells Fargo & Co. Following 2Q13 EPS Report

In a report published Monday, BMO Capital Markets analyst Peter J. Winter reiterated a Market Perform rating on Wells Fargo & Co. WFC, and raised the price target from $45.00 to $46.00. In the report, BMO Capital Markets noted, “Management highlighted the strong improvement in housing as a key driver for the strong quarter. The NCO rate dropped to the lowest level since 2006, driven by strong improvement in RRE and CRE. As a result, the provision expense outlook has improved meaningfully. Average loan growth was weak at just 1%. Consumer loan growth is improving but commercial borrowers remain cautious. WFC still managed to produce solid net interest income growth, driven by higher securities and excess liquidity balances (deposit growth). Higher interest rates are reducing pressure on earning asset yields, but higher mortgage rates are expected to slow mortgage banking in 2H13. Overall, management believes, given its diversified business model, it will be able to offset the near-term challenge to mortgage banking.” Wells Fargo & Co. closed on Friday at $42.63.