GE to sell business lending and leasing units to Wells Fargo

Vetr upgraded Wells Fargo from a “buy” rating to a “strong-buy” rating and set a $58.49 price target on the stock in a report on Thursday, September 17th. The business operates globally in six core industries: marine, recreational vehicles, motorsports, outdoor products, technology, electronics and appliances. Focus will now turn to include more of GE Capital’s overseas operations, which are expected to be sold off over the coming year.

When completed, the transaction will contribute approximately $4.2 billion of capital to the overall target of approximately $35 billion of dividends expected to be paid to GE under the disposition plan (subject to regulatory approval).

Since these are businesses that Wells Fargo is already embedded in and growing its scale, Mr. Siefers said he isn’t concerned from a risk standpoint.

Wells’ GE purchases highlight the bank’s willingness to make deals, even as rivals such as Charlotte-based Bank of America and New York-based Citigroup have been selling off assets and business units to streamline operations. The company says it has now signed deals for more than $126 billion of the more than $ 200 billion in assets the company plans to sell. “Whether we’re extending an SBA 7(a) loan or referring a business to a lender in the SBA’s Community Advantage Loan program, we want to do everything we can to meet the financial needs of more small businesses in every market and help them propel our economy forward”. GE will retain the financing businesses that relate directly to GE’s industrial businesses.

In Tuesday’s deal, Goldman Sachs Group Inc. and Credit Suisse Group AG were the bankers for GE, which got legal advice from Weil Gotshal & Manges LLP. The company has a 50-day moving average price of $51.96 and a 200-day moving average price of $55.15. GE has a 1-year high of $28.68 and a 1-year low of $19.37.

Several other equities analysts also recently weighed in on WFC.

Wells Fargo (NYSE:WFC) traded up 0.15% on Friday, hitting $52.22. The firm presently has a $58.50 price objective on the financial services provider’s stock, down from their previous price objective of $59.50. When considering if perhaps the stock is under or overvalued, the average price target is $30.33 which is 8.0% above where the stock closed yesterday. Three investment analysts have rated the stock with a sell rating, nine have given a hold rating and eighteen have assigned a buy rating to the company’s stock.