Wells Fargo preferreds fall post-earnings; Goldman Sachs closes softer; Ally closes steady

By Stephanie N. Rotondo

Portland, Ore., April 20 - A preferred market source said green was the "color of the day" on Wednesday, "in part driven by a stock market that got off to a strong start."

However, he noted that, "ironically," the three most active issues - one of which being Wells Fargo & Co.'s series F preferreds - were down.

Wells Fargo, for its part, fell after the company announced its first-quarter earnings. The preferreds traded in massive size - about 3.45 million shares changed hands.

Meanwhile, Goldman Sachs Group, Inc.'s preferreds - also one of the most actively traded securities - dropped, just one day after the investment bank released its numbers.

Wells Fargo dips on earnings

A market source saw Wells Fargo's series F preferreds falling a nickel to $25.21 on the back of the company's earnings release.

The source noted that the common equity was "down a bunch," losing $1.24, or 4.12%, to close at $28.83 (NYSE: WFC).

"Relatively speaking, you would have rather had the preferreds over the common," he said.

For the quarter, Wells Fargo posted revenues of $20.3 billion, down 5.2% year over year. Mortgage-banking fees dropped 18% to $2 billion.

Profit, however, was up 48% at 67 cents per share, versus 45 cents per share the year before. Analysts polled by Thomson Reuters were expecting a profit of 66 cents per share on revenues of $21.24 billion.

"Although they beat expectations, it wasn't by a lot and it was beginning to show softness in profitability," the source said.

Goldman Sachs falls

Goldman Sachs' series F preferreds were also weaker, losing 30 cents to close at $24.39, the market source said.

Though the shares were on the top three most active list, trading was significantly lower than that of Wells Fargo's preferreds. Just 400,000 of the Goldman Sachs preferreds were traded.

The source remarked that Goldman Sachs has been trending downward since Friday, and the firm's Tuesday earnings release "certainly didn't help," he said.

Goldman Sachs' first-quarter profit declined by 21% to $2.74 billion from $3.46 billion the year before. Revenues from fixed income, commodities and currencies were down 28% at $4.3 billion, while equity trading dipped 24% to $979 million. Advisory revenues were also weaker, falling 23% to $357 million.

Ally ends steady

Ally Financial Inc.'s series A 8 1/8% hybrid trust preferreds were the day's second most active issue, with about 2.5 million shares changing hands.

A source said the paper was flat at $26.00.

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