Key Stats
- Current price: ~$79
- Q1 2026 revenue: $20.3B, +5.7% YoY
- Q1 2026 diluted EPS: +15% YoY (per CEO commentary on the Q1 earnings call)
- Q1 2026 net interest income: $12.1B, +5.2% YoY
- Q1 2026 noninterest income: $9.4B, +8% YoY
- 2026 NII guidance: ~$50B (maintained)
- 2026 noninterest expense guidance: ~$55.7B (unchanged)
- TIKR model price target: $115 (mid case)
- Implied upside over ~5 years: ~45%
Wells Fargo Stock Reports 15% EPS Growth as Balance Sheet Tops $1 Trillion
Wells Fargo stock (WFC) delivered diluted EPS growth of 15% in Q1 2026, with total revenue rising 5.7% year over year to $20.3B, as broad-based segment momentum and the first loan portfolio above $1 trillion since early 2020 anchored the headline result.
Period-end loans grew 11% year over year to exceed $1 trillion, according to CFO Mike Santomassimo on the Q1 earnings call, with average loans up $87.8B, or 10%, driven by commercial and industrial growth as well as consumer portfolio expansion.
Net interest income rose 5.2% year over year to $12.1B, while noninterest income grew 8% year over year to $9.4B, led by investment advisory fees, brokerage commissions, and investment banking fees.
Every operating segment grew revenue from a year ago: Consumer Banking and Lending up 7%, Commercial Banking up 7%, Corporate and Investment Banking up 13% (with markets revenue up 19% and banking revenue up 11%), and Wealth and Investment Management up 14%.
CEO Charlie Scharf noted on the Q1 2026 earnings call that with revenue growing faster than expenses, pretax pre-provision profit expanded 14% from a year ago.
The noninterest expense increase of 3% year over year to levels within guidance was driven primarily by higher revenue-related compensation in WIM, partially offset by continued efficiency initiatives and the 23rd consecutive quarter of headcount reductions.
Wells Fargo repurchased $4B of common stock in Q1, returning $5.4B to shareholders in total, while maintaining its CET1 ratio at 10.3%, within the 10% to 10.5% target range.
Management maintained full-year NII guidance at ~$50B and full-year noninterest expense guidance at ~$55.7B, with CFO Santomassimo noting on the Q1 earnings call that loan growth could exceed the mid-single-digit assumption embedded in guidance if demand holds.
One blemish in an otherwise clean quarter: a single fraud-related loss in the real estate finance category within the financials-except-banks portfolio drove modestly higher commercial C&I charge-offs to 24 basis points of average loans, though management characterized the event as isolated following a comprehensive internal review.
Wells Fargo Stock Financials: Margin Compression Beneath Revenue Growth
The Q1 2026 income statement for Wells Fargo stock tells a story of healthy revenue growth running alongside deliberate margin compression, driven by a strategic expansion of the lower-margin markets balance sheet rather than deteriorating core business fundamentals.
Net interest income moved from $11.5B in Q1 2025 to $11.7B in Q2 2025, $12B in Q3 2025, $12.3B in Q4 2025, and $12.1B in Q1 2026, a trajectory that shows consistent growth from the year-ago trough before a modest sequential step-down in the most recent quarter.
The sequential decline from $12.3B to $12.1B reflected two fewer calendar days in Q1, the full-quarter impact of Q4 2025 rate cuts on floating rate assets, and the growing weight of the markets balance sheet, which carries lower net interest margins but also lower risk and capital intensity, according to CFO Santomassimo on the Q1 earnings call.
Total revenues before provision moved from $20.2B in Q1 2025 to $20.8B in Q2 2025, $21.4B in Q3 2025, $21.3B in Q4 2025, and $21.5B in Q1 2026, representing steady sequential-level recovery throughout the year and a 5.7% year-over-year improvement in the most recent quarter.
Non interest income strengthened from $8.7B in Q2 2024 to $9.5B in Q3 2025 and $9.4B in Q1 2026, as investment advisory fees and trading-related income expanded in step with AUM growth and the broadening markets platform.
Net interest margin contracted 13 basis points sequentially, driven primarily by repo growth in the markets business, a rising share of interest-bearing deposits in the commercial mix, and rate cuts, according to CFO Santomassimo on the Q1 earnings call, who also confirmed additional margin compression is expected in Q2 before the trend moderates.
What Does the Valuation Model Say?
The TIKR model prices Wells Fargo stock at $115, implying approximately 45% upside from the current price of ~$79, with a potential total return of 44.9% over the next 4.7 years and an annualized return of 8.2%.
The mid-case model assumes a revenue CAGR of 3.4% through 2035 and a net income margin of 24.5%, both within plausible range given Q1 2026’s demonstrated margin resilience and the loan growth trajectory already running ahead of internal assumptions.
The Q1 report strengthens the investment case at the margin: period-end loans cleared $1 trillion, every segment grew, credit performance remained clean outside an isolated fraud event, and the final consent order was terminated, removing an overhang that had constrained growth for years.
Wells Fargo stock enters Q2 with more operational freedom than at any point since 2019, a pipeline of organic growth levers still in early-innings execution, and a valuation that still prices in meaningful skepticism about the path to 17% to 18% ROTCE.
The central tension for Wells Fargo stock: whether the NIM compression narrative obscures a franchise that is genuinely compounding its earnings power across every segment.
Growth Case
- Revenue grew 6% year over year in Q1 2026, with pretax pre-provision profit up 14%, demonstrating operating leverage even as the mix shifts toward lower-margin assets
- Period-end loans exceeded $1 trillion, up 11% year over year, with average loan growth of 4% in Q1 alone running ahead of the mid-single-digit full-year assumption
- Markets revenue grew 19% year over year, credit card new account openings grew nearly 60%, and auto originations more than doubled, reflecting compounding origination momentum in multiple high-return segments
- The closure of the final consent order removes operational constraints that had suppressed growth for years, with management now “more fully focused on accelerating growth,” per CEO Scharf on the Q1 earnings call
Margin Case
- Net interest margin contracted 13 basis points sequentially in Q1 2026, with management guiding for additional compression in Q2, driven by the structural shift toward lower-margin markets assets and interest-bearing deposits
- NII ex-markets grew only 2% year over year despite 8% loan growth excluding markets activity, creating a disconnect between balance sheet expansion and the core interest income that most investors are pricing
- The path to 17% to 18% ROTCE remains multi-year, dependent on maturing credit card vintages, wealth platform productivity, commercial banker ramp, and investment banking wallet share gains, all of which carry execution risk across a volatile macro backdrop
- Management acknowledged on the Q1 earnings call that energy price increases are likely to impact lower-income consumers in H2 2026, introducing potential credit deterioration risk precisely as the balance sheet is scaling up
Should You Invest in Wells Fargo & Company?
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