Wells Shares Rise
Bank stock prices fell virtually across the board Thursday. One of the few exceptions was Wells Fargo & Co., which was added yesterday to Donaldson Lufkin & Jenrette's recommended list.
"We believe we're in a bull market for bank stocks, but after the significant advances in the past two weeks, there's got to be some backing and filling that takes place," said Thomas Brown of DLJ, commenting on the general slide in bank stocks.
Mr. Brown said his recommendation of Wells was primarily based on fundamentals, but added that a potential merger with First Interstate Bancorp also was a factor in plugging Wells.
Wells closed Thursday at $80 a share, up $2.375.
Wells' share price got hammered after the bank reported disappointing second-quarter results, but Mr. Brown said the third quarter has "started out to be pretty good."
The bank's net interest margin in July was stronger than the average for the second quarter," Mr. Brown said.