Morgan Stanley analyst Manan Gosalia upgraded Wells Fargo to overweight from equal weight, calling the stock a top pick with a price target of $102, implying a 27% upside from Friday’s close. Wells Fargo shares have fallen 14% year‑to‑date, underperforming peers such as JPMorgan Chase (+3.2%), Bank of America (‑2.3%), Citigroup (+10%), Morgan Stanley (+7.2%) and Goldman Sachs (+2.7%). Gosalia said normalizing balance sheet growth should ease funding pressure, stabilize net interest margin—a key profitability metric that measures interest income relative to deposit costs—and boost confidence in a path to higher returns. He described 2026 as a transition year for Wells, noting the bank is rebuilding its growth engine ahead of full earnings benefits. As expansion moderates, he expects an improved earnings profile with less margin dilution, more revenue from existing client relationships, and continued operating leverage. The analyst also highlighted that the stock trades at 1.5 times 2027 tangible book value, indicating it is undervalued and presenting a compelling buying opportunity. Following the upgrade, Wells Fargo rose more than 1% in premarket trading. Overall analyst sentiment remains bullish, with LSEG data showing 18 of 26 analysts rating the stock a buy or strong buy and an average price target implying roughly 24% upside.
