Wells Fargo Posts 11% Rise in EPS on Improved Loan Portfolio
Wells Fargo Company (NYSE: WFC) reported results for the first quarter of 2012 on Friday, beating analyst estimates on both net income and revenues. One of the largest consumer banks in the nation, its outperformance was driven by improvements in its loan portfolio.
The company reported net income of $4.2 billion, which was up 14 percent year-over-year. Diluted net earnings per share of $0.75 which was up 11 percent from the prior year's comparable quarter. EPS was up 2 cents on consensus estimates of $0.73. It was the company's seventh straight quarterly rise in net income.
Earnings came on a quarterly revenue that, at $21.6 billion, saw a 20 percent improvement over the first quarter of 2011. Sequential quarter improvement in revenues was 5 percent. Consensus estimates were also bettered by 5.6 percent. Improvement in revenue was driven by increases non-interest income, which included higher fee revenue from mortgage banking operations as well as gains from trading activities, debt securities sales and equity investments.
Gains in revenues were offset by higher personnel cost, which the company said increased by half a billion dollars for the quarter. Included in that are higher expenses in employee benefit and higher incentives, which are seasonally higher to reflect previous year's end.
WFC closed at $34.02 a share yesterday, and is up 10 cents on premarket trading following the release.
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