Wachovia Has Promise, Plus a 4.0% Yield

Article Excerpt

WACHOVIA CORP. $56 (New York symbol WB; Conservative Growth Portfolio, Finance sector; WSSF Rating: Average) has used acquisitions to grow in the past few years, including the 2001 merger of First Union Corp. and Wachovia Corp. The company’s recent purchase of Golden West Financial Corp. increased its assets by $125 billion. It is now the fourth-largest bank in the United States, with assets of $700 billion. Wachovia offers a full range of banking services through roughly 3,400 branches in 21 states. It also provides brokerage and wealth management services. Revenues grew from $14.0 billion in 2001 to $25.9 billion in 2005, or 16.6% compounded annually. Earnings grew at a compounded annual rate of 17.4%, from $2.13 a share (total $2.4 billion) in 2001 to $4.05 a share ($6.4 billion) in 2005. Most of Wachovia’s operations are along the eastern seaboard. However, the company’s recent acquisitions of Golden West and Westcorp, California’s biggest provider of used-car loans, greatly expanded its presence in the western part…

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