Jim Cramer Says Wells Fargo "Has a Bright Future"

Wells Fargo & Company (NYSE:WFC) is one of the stocks Jim Cramer reflected on. Cramer noted that his trust upgraded the stock, as he said:

“Wells Fargo reported the next one, and this one really ruined my day because we own it for the Charitable Trust, and Wall Street hated the results, even though the sales and earnings were better than expected. Some of that was from lower provisions for credit losses, offsetting the bank softer than softer-than-anticipated net interest income. Wells even cut its full year forecast for net interest income, caused people to dump the stock in droves, and me to hit the linoleum floor…

Now, on the company’s earnings call, management tried to explain this change was intentional. Now that Wells Fargo is no longer limited by the punitive asset cap, they’re prioritizing their institutional business. Think sales and trading. So whatever they lose in net interest income, they expect to make up in fees. Still, the change clearly caught everybody off guard, and I didn’t think they really explained it that well. Hence why the stock dropped more than 5% yesterday.

Still, I’m sticking with Wells Fargo for the Charitable Trust…

In fact, after yesterday’s pullback back, the trust upgraded Wells. We had it as a two. We took it up to a one, meaning, we think the stock could be bought right now. Ultimately, I trust Wells Fargo’s CEO, Charlie Scharf, who’s really good. I think he can get the bank back on track. It was never really off track, but you know what, it had that asset cap, it went away, and now I think they got so many things going, it wasn’t communicated well. They need an analyst meeting. With the asset cap gone, Wells has a bright future. It’s just, they have, I call it a messaging problem.”

Wells Fargo (NYSE:WFC) provides a wide range of financial services, including banking, lending, investment, and wealth management.

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Disclosure: None. This article is originally published at Insider Monkey.