Wells Fargo Initiates SLM with Buy Rating and $38 Price Target

Wells Fargo analyst Donald Fandetti initiated coverage of SLM with a Buy rating and $38.00 price target. The analyst consensus is a Strong Buy with an average price target of $38.44, implying a 21.15% upside from current levels. SLM has a one-year high of $34.97 and a one-year low of $19.64, with an average volume of 2.09M. Corporate insider sentiment is negative, with 64 insiders selling shares over the past quarter.

Wells Fargo analyst Donald Fandetti initiated coverage of SLM Corp (NASDAQ:SLM) with an Overweight rating and a $38.00 price target on July 2, 2025. The stock, currently trading at $31.73, has delivered a strong 49% return over the past year. The financial services firm highlighted SLM’s attractive valuation and impressive business model, with over 50% market share in the private student lending market that continues to grow [1].

Wells Fargo cited SLM’s powerful loan sale/stock buyback strategy as a key strength, while also noting the PLUS program presents meaningful upside potential. The $38 price target is based on approximately 11 times Wells Fargo’s 2026 earnings estimate of $3.55 per share, using a sum-of-the-parts methodology [1].

Analyst consensus is a Strong Buy with an average price target of $38.44, implying a 21.15% upside from current levels. SLM has a one-year high of $34.97 and a one-year low of $19.64, with an average volume of 2.09M shares. Corporate insider sentiment is negative, with 64 insiders selling shares over the past quarter [2].

In other recent news, Sallie Mae reported second-quarter earnings that did not meet analyst expectations. The company posted earnings per share of $0.32, falling short of the consensus estimate of $0.49. This shortfall was partly due to a significant increase in the provision for credit losses, which rose to $149 million from $17 million in the same period last year [1]. TD Cowen reiterated its Buy rating for SLM Corp, maintaining a price target of $40.00, despite concerns over an increase in early-stage delinquencies reported in the company’s July trust data [1].

These developments are crucial for investors to consider when evaluating SLM’s financial health. Wells Fargo is comfortable with the multiple being above SLM’s historical valuation and at the higher end of consumer finance companies’ multiples, given SLM’s dominance in private student lending and potential upside from federal student loan reform [1].

References:
[1] https://www.investing.com/news/analyst-ratings/wells-fargo-assumes-coverage-on-slm-corp-stock-with-overweight-rating-93CH-4208685
[2] https://www.investing.com/news/analyst-ratings/slm-corp-strong-buy-rating-with-average-price-target-of-38-44-93CH-4208686