JPM), Bank of America ( BAC) and Citigroup ( C), Wells Fargo has shown no immunity against a tough interest rate environment and weak loan growth. Even so, unlike some of its rivals, what I've noticed is that, despite the bank's sluggishness in mortgage lending and an overall weakness in loan demand, Wells Fargo's management has made no excuses. Instead, it has consistently raised the bar -- adding pressure on the bank's ability to perform better. Investors have responded by aligning their trust with the banks direction. It's turned out to be a smart move. On Jan. 9, I issued a $40 price target on the stock. This was while shares traded at around $34 per share. Admittedly, it wasn't a huge gamble. But considering that we were all just slowly backing away from the "fiscal cliff," it didn't make sense for me to then go too far out on another limb. Not surprisingly, shares would hit my $40 mark four months later. raised my price target to $45. On July 23, the stock reached another new 52-week high of $44.79, less than half of a percentage point from $45. With an improved interest rate environment, which coincides with Wells Fargo's better-than-expected second-quarter earnings results, these shares still look cheap. Essentially, despite some headwinds, Wells Fargo has done everything that I've asked it to do. Heading into the second-quarter report, one of my concerns (among others) had to do with the bank's lackluster performance in net interest margin (NIM), which was down by 33 basis points in the April quarter and down 8 basis points from the January quarter. I don't want to overstate the importance of NIM, but this is the metric that tells investors if management made sound investment decisions relative to the bank's debt situation. As I said above, investors aligned themselves with management. So it's important that these sorts of details aren't overlooked. From my calculation, last quarter's 33-basis-point decline told me that the bank's interest expenses were higher than the returns Wells Fargo generated from its investments. It's wasn't a good feeling.