According to a May 11th filing with the federal court in San Francisco, 3.5 million unauthorized client accounts may have been opened by employees at Wells Fargo, or a number far exceeding the preceding estimate. At the same time, law firms have been seeking approval of a $142 million settlement in relation with the sales scandal.
Wells Fargo shares closed lower for a second straight trading session on Friday. The stock went down 1.34% ($0.72) to $53.02, after touching an intraday low at $52.54, or a price level not seen since April 20th ($52.43). In the week ended on May 14th the shares of the bank holding company lost 3.79% of their market value compared to a week ago, which marked the first drop in the past four weeks. The stock has extended its loss to 1.52% so far during the current month, following a 3.27% slump in April. The latter has been a second consecutive month of decline. For the entire past year, the shares of the NYSE-listed holding company gained 1.38%.
This new estimate, revealed in the filing, exceeds what federal regulators reported earlier by 1.4 million accounts.
The settlement at the amount of $142 million encompasses accounts, which have been opened since May 2002. The initial agreement had pointed to an amount of $110 million and had encompassed accounts opened since 2009. However, as more complications emerged, Wells Fargo later agreed to the higher payout.
A preliminary approval is scheduled for consideration by US District Judge Vince Chhabria at a May 18th hearing.
According to Keller Rohrback, a law firm for the plaintiff clients, the new estimate is based on “public information, negotiations, and confirmatory discovery.” The firm also noted that the estimate “may well be over-inclusive, but provides a reasonable basis on which to estimate a maximum recovery.”
In a response, Ancel Martinez, a spokesperson for Wells Fargo, said in an emailed statement that the number was “based on a hypothetical scenario” and it did not include “actual unauthorized accounts”.
According to CNN Money, the 27 analysts, offering 12-month forecasts regarding Wells Fargo’s stock price, have a median target of $60.00, with a high estimate of $66.00 and a low estimate of $49.00. The median estimate is a 13.16% surge compared to the closing price of $53.02 on May 12th.
The same media also reported that 14 out of 31 surveyed investment analysts had rated Wells Fargo’s stock as “Hold”, while 12 – as “Buy”. On the other hand, 3 analysts had recommended selling the stock.
Daily and Weekly Pivot Levels
With the help of the Camarilla calculation method, todays levels of importance for the Wells Fargo stock are presented as follows:
R1 – $53.09
R2 – $53.16
R3 (Range Resistance – Sell) – $53.23
R4 (Long Breakout) – $53.45
R5 (Breakout Target 1) – $53.70
R6 (Breakout Target 2) – $53.81
S1 – $52.95
S2 – $52.88
S3 (Range Support – Buy) – $52.81
S4 (Short Breakout) – $52.59
S5 (Breakout Target 1) – $52.34
S6 (Breakout Target 2) – $52.23
By using the traditional method of calculation, the weekly levels of importance for Wells Fargo & Company (WFC) are presented as follows:
Central Pivot Point – $53.64
R1 – $54.75
R2 – $56.47
R3 – $57.58
R4 – $58.68
S1 – $51.92
S2 – $50.81
S3 – $49.09
S4 – $47.36
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