Squawk on the Street

Cramer's Morning Take: Wells Fargo 9/13/24

Cramer says this is the bank stock to buy. Become a CNBC Investing Club member to go behind the scenes with Jim Cramer and Jeff Marks as they talk candidly about the market’s biggest headlines. Signup here: cnbc.com/morningtake CNBC Investing Club Disclaimer

Duration:: 5m
Broadcast on:: 13 Sep 2024
Audio Format:: mp3

CNBC Investing Club Disclaimer

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Jim Kramer here to share with you a sample of my take on the market from today's CBC Investing Club morning meeting. What's up, Wells Fargo? There was a piece came out this morning shaping morning. Basically said that this is new, it's bad, it's going to cost a lot of money. It's old, it's not bad, and it won't cost a lot of money. And I think that we've had to recognize, as we said yesterday, to me, this is the bank stock to buy, if you want to buy a bank stock. And it was up to up 20%. Now it's only up to six. And this story, not a can-art. Who wants to be in the paper saying all this stuff is happening. But it's been behind the scenes, it's been going on for a long time, not new news. So let's explain what happened. So the stock was higher for most of the session yesterday, but it fell. It was down close to 6% at one point and closed down around 4%. This was after the office of the controller of the currency, the OCC, issued an enforcement action against wells, identified deficiencies in the bank's financial crime risk management practices and anti-money laundering internal controls. Not completely new news, they actually flagged this in their 10Q in early August, after second quarter earnings, that there was an investigation. So why it fell, there may be some concerns that Wells Fargo will have to invest more in risk controls that could take up their expense outlook, although the CFO was at the Barclays Conference earlier this week, who knew that an investigation was happening at the time. He said he felt comfortable with the expense got for the year. Right, it's been very different to Pinto and JPMorgan, not one bomb, but multiple bombs. And then, of course, one could argue that this could be a setback in Wells Fargo's timeline to get that asset cap removed. Maybe, maybe not. It's really unclear about it. Okay, it's really unclear about this timeline anyway. No one really knows what it will be next year, maybe the year after that. Who knows? But I think it's also important to note that this isn't a Wells Fargo isolated incident. There's also some language in the filings from Bank of America, TV, and some of their forward-looking statements. So this could just be a crackdown across the board here. And I think importantly, Wells is already working on corrective actions. That was in their statement. And historically, they have been hit with these enforcement actions from the OCC over the last couple of years. They've been a good buying opportunity every time. Yes, yes. So I think we're thinking the same exact, even with the stock up 2%. So I mean, I talked to Jeff this morning, and I said, "Listen, we should go buy some Wells Fargo. We talked about it Tuesday. We went over the restrictions at... The three-day rule. The three-day rule. If you don't own any Wells, maybe you're looking to buy some more. Have some cash right here. Join the CMC Investing Club with Jim Kramer. You catch my member-exclusive warning meetings every day at 10-20 a.m. Visit cmbc.com/morningtake to become a member today. That's one word, morning take. All opinions expressed by Jim Kramer on this podcast and in connection with the CNBC Investing Club are solely Kramer's opinions and do not reflect the opinions of CNBC, NBC, Universal, or their parent company or affiliates, and may have been previously disseminated by Kramer on television, radio, internet, or another medium. No specific outcome or profit is guaranteed in connection with your reliance upon or other use of the content from Kramer. The opinions offered in connection with this podcast and the CNBC Investing Club are not an attempt to induce any particular trading behavior, investment or strategy. 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