New Mountain Finance: Wells Fargo Downgrades to Equal-Weight, Lowers PT to $10.

New Mountain Finance: Wells Fargo Downgrades to Equal-Weight, Lowers PT to $10.

Wells Fargo & Company (NYSE:WFC) has downgraded its rating for New Mountain Finance Inc. (NMFC) to "Equal-Weight" and lowered its price target to $10, effective immediately. This move follows recent regulatory developments and financial performance of Wells Fargo itself.

Wells Fargo's decision comes on the heels of the Consumer Financial Protection Bureau (CFPB) ending its 2018 consent order related to the bank's compliance risk management program. This marks the 12th such order closed since 2019, with six orders closed since the start of 2025 [1]. The bank remains under two active consent orders, including a $1.95 trillion asset cap imposed by the Federal Reserve in 2018.

Meanwhile, New Mountain Finance's stock has been volatile. In the current session, NMFC is trading at $9.98, down 1.38% from the previous session. Over the past month, the stock fell by 8.85%, and in the past year, by 20.68% [2]. Analysts at Wells Fargo have noted that the company's price-to-earnings (P/E) ratio is lower than the industry average, indicating potential undervaluation. However, they caution that a lower P/E ratio can also suggest a lack of expected future growth.

Wells Fargo's downgrade and lowered price target reflect their cautious outlook on New Mountain Finance's stock performance. The bank's analysts have advised investors to use the P/E ratio in conjunction with other financial metrics and qualitative analysis to make informed investment decisions.

Reference List:
[1] https://seekingalpha.com/news/4436210-wells-fargo-gets-another-consent-order-lifted
[2] https://www.benzinga.com/insights/news/25/04/45011534/price-over-earnings-overview-new-mountain-finance