Wells Fargo & Co (WFC) revealed earlier this week plans to raise minimum hourly pay to between $15 and $20 for the majority of its US markets by the end of the current year.
The pay raise is expected to affect more than 20 000 employees across the United States and is to be based on staff location, the Wall Street bank said.
Wells Fargo shares closed lower for the seventh time in the past ten trading sessions in New York on Thursday. It has also been the steepest single-session loss since February 5th 2018. The stock went down 6.01% ($2.49) to $38.91, after touching an intraday low at $38.57, or a price level not seen since May 14th 2013 ($38.21).
Shares of Wells Fargo & Company have retreated 27.68% so far in 2020 compared with a 6.40% loss for the benchmark index, S&P 500 (SPX).
In 2019, Wells Fargo’s stock went up 16.75%, thus, it again underperformed the S&P 500, which registered a 28.88% gain.
Wells Fargo employees based in New York or San Francisco will now be paid minimum $20 per hour, while employees based in Charlotte or Des Moines will now receive $16 in minimum hourly pay.
Over the past few years, Wells Fargo’s minimum hourly wage in the United States has been raised by nearly 32%, with the latest increase being to $15 in March 2018.
Analyst stock price forecast and recommendation
According to CNN Money, the 21 analysts, offering 12-month forecasts regarding Wells Fargo’s stock price, have a median target of $49.00 with a high estimate of $57.00 and a low estimate of $42.00. The median estimate represents a 25.93% upside compared to the closing price of $38.91 on March 5th.
The same media also reported that at least 17 out of 25 surveyed investment analysts had rated Wells Fargo’s stock as “Hold”, while 2 – as “Buy”. On the other hand, 5 analysts had recommended selling the stock.