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Wells Fargo (NYSE:WFC) Piotroski F-Score

: 8 (As of Today)
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Good Sign:

Piotroski F-Score is 8, indicates a very healthy situation.

The zones of discrimination were as such:

Good or high score = 7, 8, 9
Bad or low score = 0, 1, 2, 3

Wells Fargo has an F-score of 8. It is a good or high score, which usually indicates a very healthy situation.

The historical rank and industry rank for Wells Fargo's Piotroski F-Score or its related term are showing as below:

WFC' s Piotroski F-Score Range Over the Past 10 Years
Min: 3   Med: 5   Max: 8
Current: 8

During the past 13 years, the highest Piotroski F-Score of Wells Fargo was 8. The lowest was 3. And the median was 5.


Wells Fargo Piotroski F-Score Historical Data

The historical data trend for Wells Fargo's Piotroski F-Score can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

Wells Fargo Annual Data
Trend Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21 Dec22 Dec23
Piotroski F-Score
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 5.00 4.00 7.00 4.00 8.00

Wells Fargo Quarterly Data
Mar19 Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22 Dec22 Mar23 Jun23 Sep23 Dec23
Piotroski F-Score Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 4.00 5.00 6.00 8.00 8.00

Competitive Comparison

For the Banks - Diversified subindustry, Wells Fargo's Piotroski F-Score, along with its competitors' market caps and Piotroski F-Score data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.


Wells Fargo Piotroski F-Score Distribution

For the Banks industry and Financial Services sector, Wells Fargo's Piotroski F-Score distribution charts can be found below:

* The bar in red indicates where Wells Fargo's Piotroski F-Score falls into.


How is the Piotroski F-Score calculated?

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

This Year (Dec23) TTM:Last Year (Dec22) TTM:
Net Income was 4991 + 4938 + 5767 + 3446 = $19,142 Mil.
Cash Flow from Operations was 7406 + -755 + 15505 + 18202 = $40,358 Mil.
Revenue was 20729 + 20533 + 20857 + 20478 = $82,597 Mil.
Average Total Assets from the begining of this year (Dec22)
to the end of this year (Dec23) was
(1881020 + 1886400 + 1876320 + 1909261 + 1932468) / 5 = $1897093.8 Mil.
Total Assets at the begining of this year (Dec22) was $1,881,020 Mil.
Long-Term Debt & Capital Lease Obligation was $207,588 Mil.
Total Assets was $1,932,468 Mil.
Total Liabilities was $1,745,025 Mil.
Net Income was 3788 + 3142 + 3592 + 3155 = $13,677 Mil.

Revenue was 17728 + 17040 + 19566 + 20034 = $74,368 Mil.
Average Total Assets from the begining of last year (Dec21)
to the end of last year (Dec22) was
(1948068 + 1939709 + 1881142 + 1877745 + 1881020) / 5 = $1905536.8 Mil.
Total Assets at the begining of last year (Dec21) was $1,948,068 Mil.
Long-Term Debt & Capital Lease Obligation was $174,870 Mil.
Total Assets was $1,881,020 Mil.
Total Liabilities was $1,698,807 Mil.

*Note: If the latest quarterly/semi-annual/annual total assets data is 0, then we will use previous quarterly/semi-annual/annual data for all the items in the balance sheet.

Profitability

Question 1. Return on Assets (ROA)

Net income before extraordinary items for the year divided by Total Assets at the beginning of the year.

Score 1 if positive, 0 if negative.

Wells Fargo's current Net Income (TTM) was 19,142. ==> Positive ==> Score 1.

Question 2. Cash Flow Return on Assets (CFROA)

Net cash flow from operating activities (operating cash flow) divided by Total Assets at the beginning of the year.

Score 1 if positive, 0 if negative.

Wells Fargo's current Cash Flow from Operations (TTM) was 40,358. ==> Positive ==> Score 1.

Question 3. Change in Return on Assets

Compare this year's return on assets (1) to last year's return on assets.

Score 1 if it's higher, 0 if it's lower.

ROA (This Year)=Net Income/Total Assets (Dec22)
=19142/1881020
=0.01017639

ROA (Last Year)=Net Income/Total Assets (Dec21)
=13677/1948068
=0.0070208

Wells Fargo's return on assets of this year was 0.01017639. Wells Fargo's return on assets of last year was 0.0070208. ==> This year is higher. ==> Score 1.

Question 4. Quality of Earnings (Accrual)

Compare Cash flow return on assets (2) to return on assets (1)

Score 1 if CFROA > ROA, 0 if CFROA <= ROA.

Wells Fargo's current Net Income (TTM) was 19,142. Wells Fargo's current Cash Flow from Operations (TTM) was 40,358. ==> 40,358 > 19,142 ==> CFROA > ROA ==> Score 1.

Funding

Question 5. Change in Gearing or Leverage

Compare this year's gearing (long-term debt divided by average total assets) to last year's gearing.

Score 0 if this year's gearing is higher, 1 otherwise.

Gearing (This Year: Dec23)=Long-Term Debt & Capital Lease Obligation/Average Total Assets from Dec22 to Dec23
=207588/1897093.8
=0.10942422

Gearing (Last Year: Dec22)=Long-Term Debt & Capital Lease Obligation/Average Total Assets from Dec21 to Dec22
=174870/1905536.8
=0.09176942

Wells Fargo's gearing of this year was 0.10942422. Wells Fargo's gearing of last year was 0.09176942. ==> Last year is lower than this year ==> Score 0.

Question 6. Change in Working Capital (Liquidity)

Compare this year's current ratio (current assets divided by current liabilities) to last year's current ratio.

Score 1 if this year's current ratio is higher, 0 if it's lower

* Note that for banks and insurance companies, there's no Total Current Assets and Total Current Liabilities reported. Thus, we use Total Assets and Total Liabilities to calculate current ratio for banks and insurance companies.

Current Ratio (This Year: Dec23)=Total Assets/Total Liabilities
=1932468/1745025
=1.10741565

Current Ratio (Last Year: Dec22)=Total Assets/Total Liabilities
=1881020/1698807
=1.10725939

Wells Fargo's current ratio of this year was 1.10741565. Wells Fargo's current ratio of last year was 1.10725939. ==> This year's current ratio is higher. ==> Score 1.

Question 7. Change in Shares in Issue

Compare the number of shares in issue this year, to the number in issue last year.

Score 0 if there is larger number of shares in issue this year, 1 otherwise.

Wells Fargo's number of shares in issue this year was 3656.8. Wells Fargo's number of shares in issue last year was 3832.5. ==> There is smaller number of shares in issue this year, or the same. ==> Score 1.

Efficiency

Question 8. Change in Gross Margin

Compare this year's gross margin (Gross Profit divided by sales) to last year's.

Score 1 if this year's gross margin is higher, 0 if it's lower.

* Note that for banks and insurance companies, there's no Gross Profit reported. Thus, we use net income instead of gross profit and calculate Net Margin for this score.

Net Margin (This Year: TTM)=Net Income/Revenue
=19142/82597
=0.23175176

Net Margin (Last Year: TTM)=Net Income/Revenue
=13677/74368
=0.18390975

Wells Fargo's net margin of this year was 0.23175176. Wells Fargo's net margin of last year was 0.18390975. ==> This year's net margin is higher. ==> Score 1.

Question 9. Change in asset turnover

Compare this year's asset turnover (total sales for the year divided by total assets at the beginning of the year) to last year's asset turnover ratio.

Score 1 if this year's asset turnover ratio is higher, 0 if it's lower

Asset Turnover (This Year)=Revenue/Total Assets at the Beginning of This Year (Dec22)
=82597/1881020
=0.04391075

Asset Turnover (Last Year)=Revenue/Total Assets at the Beginning of Last Year (Dec21)
=74368/1948068
=0.03817526

Wells Fargo's asset turnover of this year was 0.04391075. Wells Fargo's asset turnover of last year was 0.03817526. ==> This year's asset turnover is higher. ==> Score 1.

Evaluation

Piotroski F-Score= Que. 1+ Que. 2+ Que. 3+Que. 4+Que. 5+Que. 6+Que. 7+Que. 8+Que. 9
=1+1+1+1+0+1+1+1+1
=8

Good or high score = 7, 8, 9
Bad or low score = 0, 1, 2, 3

Wells Fargo has an F-score of 8. It is a good or high score, which usually indicates a very healthy situation.

Wells Fargo  (NYSE:WFC) Piotroski F-Score Explanation

The developer of the system is Joseph D. Piotroski is relatively unknown accounting professor who shuns publicity and rarely gives interviews.

He graduated from the University of Illinois with a B.S. in accounting in 1989, received an M.B.A. from Indiana University in 1994. Five years later, in 1999, after earning a Ph.D. in accounting from the University of Michigan, he became an associate professor of accounting at the University of Chicago.

In 2000, he wrote a research paper called "Value Investing: The Use of Historical Financial Statement Information to Separate Winners from Losers" (pdf).

He wanted to see if he can develop a system (using a simple nine-point scoring system) that can increase the returns of a strategy of investing in low price to book (referred to in the paper as high book to market) value companies.

What he found was something that exceeded his most optimistic expectations.

Buying only those companies that scored highest (8 or 9) on his nine-point scale, or F-Score as he called it, over the 20 year period from 1976 to 1996 led to an average out-performance over the market of 13.4%.

Even more impressive were the results of a strategy of investing in the highest F-Score companies (8 or 9) and shorting companies with the lowest F-Score (0 or 1).

Over the same period from 1976 to 1996 (20 years) this strategy led to an average yearly return of 23%, substantially outperforming the average S&P 500 index return of 15.83% over the same period.


Wells Fargo Piotroski F-Score Related Terms

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Wells Fargo (NYSE:WFC) Business Description

Address
420 Montgomery Street, San Francisco, CA, USA, 94104
Wells Fargo is one of the largest banks in the United States, with approximately $1.9 trillion in balance sheet assets. The company has four primary segments: consumer banking, commercial banking, corporate and investment banking, and wealth and investment management. It is almost entirely focused on the U.S.
Executives
Richard K Davis director 800 NICOLLET MALL, MINNEAPOLIS MN 55402
Thomas R Nides officer: Vice Chairman C/O WELLS FARGO & COMPANY, 420 MONTGOMERY STREET, SAN FRANCISCO CA 94104
Tracy M Kerrins officer: Sr. Executive Vice President 300 S BREVARD STREET, CHARLOTTE NC 28202
Kyle G Hranicky officer: Sr. Executive Vice President 1000 LOUISIANA STREET, HOUSTON TX 77002
Felicia F Norwood director 120 MONUMENT CIRCLE, INDIANAPOLIS IN 46204
Kleber Santos officer: Sr. Executive Vice President 1680 CAPITAL ONE DRIVE, MCLEAN VA 22102
Ellen R Patterson officer: Sr. EVP and General Counsel 30 HUDSON YARDS, NEW YORK NY 10001
Kristy Fercho officer: Sr. Executive Vice President 5151 CORPORATE DRIVE, TROY MI 48098
Cecelia Morken director 26025 MUREAU ROAD, CALABASAS CA 91302
Beurden Saul Van officer: Sr. Executive Vice President 150 EAST 42ND STREET, NEW YORK NY 10017
Bei Ling officer: Sr. Executive Vice President 30 HUDSON YARDS, NEW YORK NY 10001
Ather Iii Williams officer: Sr. Executive Vice President 30 HUDSON YARDS, NEW YORK NY 10001
Michael P. Santomassimo officer: Sr. EVP & CFO 225 LIBERTY STREET, NEW YORK NY 10286
Mark A Chancy director 303 PEACHTREE ST., 30TH FLOOR, ATLANTA GA 30308
Lester Owens officer: Sr. Executive Vice President 240 GREENWICH STREET, NEW YORK NY 10286