Wells Fargo & Company (NYSE:WFC) drew fresh investor focus Wednesday as Wall Street weighed the bank’s post-asset-cap trajectory.
Wells Fargo started a new chapter last year following the removal of the 2018 Fed-imposed asset cap (along with several other regulatory consent orders).
Recent commentary from an analyst highlighted opportunities for stronger efficiency, steadier growth, and improving returns as regulatory pressures ease.
Bank of America Securities analyst Ebrahim H. Poonawala reiterated the Buy rating on the stock, raising the price forecast from $100 to $107.
According to Poonawala, Wells Fargo remains a long-term turnaround story supported by several catalysts. He said the bank still has room to lift productivity and expand products beyond costs tied to regulation.
The analyst highlights that a normalized ROTCE in the high-teens looks achievable, which could drive shares toward or above two times tangible book.
Wells Fargo entered a new phase after regulators lifted the 2018 Federal Reserve asset cap.
The analyst writes that prior consent orders hurt deposit share, lending growth, and overall franchise efficiency.
He added that management now targets faster growth and better productivity following the cap removal.
Poonawala forecast earnings per share of $7.07 for fiscal 2026 and $8.21 for fiscal 2027. He said that implies average annual earnings growth of about 15% during those two years.
Margin expansion, modest balance-sheet growth, and operating leverage should drive that profit increase, the analyst adds, with efficiency gains reaching about 200 basis points by 2027.
Poonawala said the CET1 capital ratio should trend near 10.25% versus 11% in the third quarter.
He noted that rate cuts could trim net interest income, but repricing and growth should offset the impact.
He said the model assumes two rate cuts and a three-percent headwind to net interest income.
The analyst expects ROTCE to reach 17% by 2027 and near 18% by 2028.
He said longer-term self-help and scale advantages should support earnings growth and future stock gains.
WFC Price Action: Wells Fargo shares were down 2.32% at $94.15 at the time of publication on Wednesday. The stock is approaching its 52-week high of $97.76, according to Benzinga Pro data.
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