Jim Cramer’s Game Plan: 12 Stocks in Focus This Week

4. Wells Fargo & Company (NYSE:WFC)

Number of Hedge Fund Holders: 72

Cramer said that stocks like Wells Fargo & Company (NYSE:WFC) have low price-to-earnings multiples these days, which presents a buying opportunity.

“On Wednesday, we’re gonna hear from JPMorgan, Goldman Sachs, Wells Fargo, and Citigroup. I think they’re all gonna be pretty darn good. Plus, given the environment has improved for mergers and acquisitions, as we’ve seen already this year, we gotta have some excellent forecast. I like these stocks and they’re well off their highs with very low price-to-earnings multiples. Could it be a real opportunity? I think so. We’ve been buying a bunch of them for the Charitable Trust because a robust economy often produces the best results for these companies. Regardless of the bond market or the Fed. We have less, fewer credit problems.”

Wells Fargo (NYSE:WFC) is a major global financial services firm that provides a wide range of banking, investment, mortgage, and financial products. The company provides essential services to individuals, businesses, and institutions. Looking ahead, it expects a 9% decline in its net interest income (NII) in 2024.

NII represents the difference between the bank’s earnings from loans and the interest it pays out to depositors. However, as reported by Reuters, the bank’s Chief Financial Officer, Michael Santomassimo, noted that NII could see some improvement due to rate cuts, as these cuts would lower the costs of retaining deposits. Santomassimo explained that the decline in interest rates on products like certificates of deposit, promotional savings instruments, and most interest-sensitive deposits within the commercial banking division is expected to continue.

As the bank’s need to pay depositors decreases with the ongoing rate cuts, it could result in a positive impact on NII in the longer term. According to Santomassimo, Wells Fargo (NYSE:WFC) expects NII to stabilize and possibly reach a trough by the fourth quarter of 2024, marking the lowest point before it begins to recover.