John Stumpf of Wells Fargo Co (NYSE:WFC) Defeats Amazon (AMZN)’s Bezos To Win CEO Of The Year
Wells Fargo & Co (NYSE:WFC)’s CEO, John Stumpf, defeated two other finalists, including Amazon.com, Inc. (NASDAQ:AMZN)’s head, Jeff Bezos, to clinch Morningstar’s 2015 CEO of the Year award. Stumpf also beat General Electric Company (NYSE:GE)’s Jeff Immelt to claim the award. As surprising as the development might seem for some, Morningstar insists there is every justification to place Stumpf ahead of peers and that many factors were considered in reaching the decision.
Not based on stock performance
Those who expressed surprise at the naming of Wells Fargo & Co (NYSE:WFC)’s Stumpf as the CEO of the Year seemed to compare his bank’s stock performance with that of the companies whose CEOs he beat to claim the award. In 2015, Wells Fargo’s stock descended 1%, Amazon’s rose 118% and GE’s stock jumped 24%. On that basis, Stumpf’s company stock performance didn’t even come near that of his competitors for the award.
However, Morningstar says that there is a huge difference between the best CEO and the best stock.
It turns out Morningstar didn’t base its selection of Wells Fargo & Co (NYSE:WFC)’s chief for the 2015 CEO of the Year award on just a year’s performance. According to Morningstar, Stumpf’s recognition is based on the success of his company in the recent years. He is particularly credited for leading Wells Fargo through a tough period in the financial industry and most of all the expectations he put the interest of customers ahead of profits.
The other thing that impressed Morningstar in Wells Fargo’s Stumpf is how the CEO demonstrated independent thinking in his executions.
Compared with its peers, Wells Fargo & Co (NYSE:WFC) has more than recovered from the Great Recession crisis. The bank’s stock price has gained 35% from mid-2007. In contrast, Bank of America Corp (NYSE:BAC)’s stock remains down 73% over the same period and Morgan Stanley (NYSE:MS)’s stock is still down 64%. Goldman Sachs Group Inc (NYSE:GS) on its part is still down 32% from its pre-recession price. JPMorgan & Case Co. (NYSE:JPM)’s stock is up 10% since mid-2017, but that still trails Wells Fargo’s rise.
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