Wells Fargo Sees 90% Probability of Merger Between Reynolds and Lorillard

Shares of

gain 2.33 percent in Wednesday's premarket trading following Wells Fargo analyst comments on

. On Tuesday, Wells Fargo Managing Director Bonnie Herzog told CNBC's “Fast Money” that a merger between Reynolds American

and Lorillard will likely happen. Bonnie Herzog commented, “I am still convinced that a deal is going to happen, and I think it's around the corner. A deal between Reynolds American and Lorillard makes a lot of sense. So, my conviction is quite high. I have about a 90 percent probability.” The Wells Fargo Director added that the merger would help drive margins in the e-cigarette and vapor market. Lorillard shares closed at $61.76 on Tuesday. In after-hours trading, the stock gained 2.315 percent at $63.19. Shares dropped to $62.50 in premarket trading before climbing back up to $63.20. The stock saw a slight dip before hovering at $63.09. Lorillard opened at $62.93 on Wednesday.