The notion of a co-CEO is not new. But the idea also feels like a huge waste, at least to some, who wonder why two people need that high-paying of a job. Wells Fargo (WFC) used to be one of those companies with a second CEO, but now, the bank has lost one of its CEOs, and investors are cheering for a paycheck that no longer needs written, sending shares up fractionally in Thursday afternoon’s trading.
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The reports note that Jon Weiss plans to depart, and take with him one of the co-chief executive officer slots of the corporate and investment bank. That would put Fernando Rivas in sole charge, and at a time when the unit has been pulling in a lot of new talent to oversee.
Weiss plans to step down immediately, but will not formally depart the bank until June 1. The loss will actually be fairly acutely felt; word from CEO Charlie Scharf points out that CIB net income was up 40%, while revenue was up 35%, showing that more came in and less was wasted under Weiss’ tenure as well.
A Growing Dealmaking Environment
With the return of President Trump, the market for dealmaking is expected to surge, and make Wells Fargo’s augmentations in that field particularly valuable. With improvements already seen in dealmaking, and government regulators likely more open to the entire concept of M&A, that should represent a growing sector that Wells Fargo is better-placed to take on, reports note.
And the government is already getting off Wells Fargo’s back; reports noted that the Consumer Financial Protection Bureau (CFPB) recently terminated a 2022 consent order connected to Wells Fargo. This represented the seventh such consent order closed just since 2019, a sign that Wells Fargo has been cleaning up its collective act and “…working systemically to change and provide customer remediation where warranted.”
Is Wells Fargo a Buy or Sell?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on WFC stock based on 10 Buys and nine Holds assigned in the past three months, as indicated by the graphic below. After a 61.08% rally in its share price over the past year, the average WFC price target of $82.94 per share implies 5.3% upside potential.
