11:02 AM EDT, 10/14/2024 (MT Newswires) -- Wells Fargo's ( WFC ) long-term outlook is strong and it is poised to be able to achieve the target of 15% return on tangible common equity once the current asset cap on the bank is lifted, RBC Capital said in a note emailed Monday.

"Until the asset cap is lifted, management is driving shareholder value through building up 'asset light' businesses, optimizing expense levels and managing its excess capital levels," the firm said.

Wells Fargo ( WFC ) may outperform other large banks due to its unique competitive advantage, particularly once the Basel III regulatory proposals are implemented and the asset cap is lifted, according to the note.

The bank's Q3 core earnings per share stood at $1.51, exceeding both the internal estimate of $1.26 and the consensus estimate of $1.28, the firm said.

RBC revised its 2024 EPS estimate for Wells Fargo ( WFC ) to $5.47, driven by higher fee revenues and a reduced provision for credit losses, maintained the 2025 estimate at $5.50, and introduced a new estimate for 2026 at $6.45.

The firm reiterated its sector perform ratings for Wells Fargo ( WFC ) and kept the price target at $61.

Shares of the company were up over 3% in recent trading.

Price: 63.10, Change: +2.11, Percent Change: +3.45