WFC down 1.75 to $31.90
Stifel Nicolaus downgrades Wells Fargo from Hold to Sell . Stifel downgrades WFC to Sell from Hold based on valuation. The firm says this move is one of the toughest decisions they have made in recent years.
They still believe the co has one of the better management teams in the industry and has a strong capital position relative to other large-cap banks. However, the shares currently trade at 14.0x their 2008 EPS of $2.40, which is in line with the broader market multiple. This premium multiple comes despite the fact that the firm has lowered their 2008 EPS estimate by 20% since 2Q07, which shows that while the company has avoided the large CDO and market valuation writedowns, it is not immune to the overall economic environment.
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