Wells Fargo Upgraded At J.P. Morgan, Because It's a 'steadier Port' Than Its Peers

Wells Fargo & Co. was upgraded on Friday at J.P. Morgan, which called the banking giant "a steadier port in uncertain markets" than its peers. Analyst Vivek Juneja raised his rating to overweight, after being at neutral for the last 15 months, but trimmed his stock price target to $58.50 from $59.50. He said Wells Fargo's better-than-peer track record makes its stock a more defensive play, following the recent weakness in financial sector and given that he expects financial markets to remain choppy. Juneja said the expected increase in capital returns the rest of this year and relatively-high dividend yield--the 2.85% annual dividend yield compares with the SPDR Financial ETF distribution yield of 1.88%--also makes the stock relatively attractive. Juneja said the recent increase in mortgage refinancing should help Wells Fargo more than its peers, since the bank has the largest share of revenue from mortgages. The stock, which rose 0.9% in premarket trade, has lost 5.3% over the past three months, while the XLF has declined 3.9% and the S&P 500 has slipped 1.9%.