17 questions reported in Wells Fargo interviews, organised by the group that asks them. Every question carries a model answer and graded feedback on your own attempt.
Questions
Easy · Medium
Hard
Model builds
Built in the spreadsheet grid
Reserve-based valuation, commodity decks, contracted cash flows and PPAs. 4 questions
Asked in power-coverage interviews to test why dispatchable generation can earn value even when it runs infrequently.
Explain the difference between energy-market revenue and capacity-market revenue for a gas-fired power plant. Why can a plant that runs only during peak hours still be economically valuable?
The opening question for midstream and infrastructure coverage interviews.
Explain the business model of a pipeline company. How do they generate revenue and what are the key risks?
The foundational regulated utility question. Returns are set by regulators, not markets.
Explain how regulators determine the allowed return on equity for a utility. What factors go into the rate case, and how does this affect valuation?
MLPs were the dominant structure for midstream energy. Understanding them is still relevant for existing infrastructure.
Explain the master limited partnership structure. Why were midstream energy companies organised as MLPs, and what are the key considerations for valuation?
Merger models, accretion/dilution, purchase accounting and deal judgement. 3 questions
Foundational for DCF and LBO modeling; asked across all banking groups.
Where does capex appear on each statement? Distinguish maintenance from growth capex and explain why the split matters in valuation.
A quick screen on whether you actually understand accrual mechanics.
Explain the difference between a prepaid expense and an accrued liability. Give an example of each and the cash flow effect.
Screening question across banking, corporate finance and credit interviews.
Define working capital and net working capital. What does an increase in net working capital do to cash flow, and what does a negative working capital balance tell you about a business?
Cyclicality, operating leverage, backlog quality and mid-cycle earnings. 2 questions
A cash-flow question for capital-intensive businesses.
Why is the split between maintenance capex and growth capex especially important for industrials?
An industrials coverage analyst often has to explain quickly whether reported growth reflects end-market demand or acquired and translated revenue.
An industrial company reports revenue rising from $1,000m to $1,120m. Management says the bridge was 6% price, 3% volume, 4% acquisitions and a 1% FX headwind. Reconcile the growth and explain what…
Ratings, spreads, tenor and covenant packages, and pricing a new issue. 1 question
An analyst-level arithmetic check used when preparing an issuance summary and sources-and-uses bridge.
A company issues $500 million face amount of 10-year notes at 99.25. Underwriting fees are 35 bps of face amount and legal, rating, and printing costs total $0.60 million. Calculate gross cash…
Driver-based models, differentiated estimates and defending a rating. 1 question
A common interview question for candidates expected to explain ratings and valuation to clients.
A stock trades at $40. Your forecast is $3.00 of next-year EPS and you believe 18x is the appropriate forward P/E multiple. Set a price target and explain what else belongs in the recommendation.
Leverage capacity, documentation, downside cases and portfolio construction. 1 question
A distinct discipline from cash flow lending, and common in retail and distribution credits.
How does asset-based lending differ from cash flow lending? Construct a borrowing base for a distributor with $200m of receivables and $150m of inventory.
Structuring for downside, collateral, priming risk and recovery. 1 question
An asset-based lending scenario that distinguishes collateral availability from headline debt capacity.
An ABL facility has $80m outstanding. Eligible receivables are $60m at an 80% advance rate and eligible inventory is $50m at a 50% advance rate. Is there a borrowing-base shortfall, and what do you…
Greeks, skew, hedging costs and payoff construction. 1 question
A desk arithmetic test after a candidate proposes a cap as protection for floating-rate debt.
A borrower has $50m of 90-day SOFR debt paying SOFR plus 1.80%. It buys a cap on $50m with a 4.00% strike for the same 90-day period. If realised SOFR fixes at 5.20%, calculate the cap payment and the…
Development spreads, cost overruns, lease-up risk and construction draws. 1 question
Tests practical knowledge of how development debt funds over time.
How does a construction loan fund, and why is interest reserve important?
Leasing spreads, capex programmes, refinancing and hold-sell analysis. 1 question
Refinancing can improve returns or create risk. This tests understanding of real estate finance.
A property has 5 years remaining on a 10-year loan at 5.5% interest. Current market rates are 4.5%. Should you refinance, and what factors do you consider?
Pipeline risk-adjusted valuation, reimbursement and patent cliffs. 1 question
A managed-care earnings review tests whether you can turn a headline medical-cost ratio into a clean operating-profit bridge.
A Medicare Advantage insurer reports $1,000m of premium revenue, $840m of medical claims and $80m of administrative expense. Calculate its medical cost ratio and operating profit. If claims rise by…
Write your answer, get it graded on technical accuracy, completeness and communication, and see exactly which mechanic you missed.
Company tags reflect where a question type is commonly reported in interviews. They are not sourced from, endorsed by, or affiliated with Wells Fargo.