In September 2020, I said that there was a $10 billion reason to buy shares of Wells Fargo (NYSE: WFC). I was referring to the $10 billion in expense savings that the company had identified and would realize in the coming years. None of these savings were priced into earnings. Seeing as Wells Fargo was already trading at an incredibly cheap valuation, looking at expense cuts on the horizon and running a rock-solid balance sheet, its stock was a perfect asymmetric opportunity. By "asymmetric," I mean little downside risk and lots of upside potential. It was perfect timing to jump on this trade. From September 2020 through February 2022, Wells Fargo shares were up 150% while the S&P 500 was up just 35%. And now, in spite of 2022 being such tough sledding for investors, I'm confident that profit prospects for the banking sector have actually improved... Which means we're looking at an industrywide buying opportunity. Big banks at big discounts? Sign us up... | 
Post a Comment
Post a Comment