Wells Fargo shares have fallen far behind other financial stocks this year as the bank struggles to recover from a consumer sales scandal that broke last year. The stock has now fallen out of favor with a noted investor.
"The cultural issues I think at Wells Fargo went very, very deep," Eisman told CNBC in a phone interview. "They have to unwind these cultural issues."
Eisman expects earnings will be "flattish" over the next few years, and pointed to negative signs such as the bank's decline in loans in the third quarter. He said he generally doesn't give price targets.
Wells Fargo declined to comment to CNBC.
On the other hand, "Citi is the cheapest large bank," Eisman told CNBC. He said he expects plans to reduce regulation will improve Citi's return on equity to 14 or 15 percent from around 8 percent.
Citi also declined to comment.
Eisman famously bet against the housing market by shorting, or betting against, U.S. banks ahead of the financial crisis, which was depicted in the movie "The Big Short." In May, Eisman said on CNBC's "Fast Money" that he is now investing in "a whole bunch of banks and investment banks" and specifically mentioned Citigroup.
Eisman gave his presentation on the bank stocks Thursday at Capitalize for Kids, an investment conference in Toronto, Canada, whose proceeds go towards helping to solve challenges in children's brain and mental health.
Wells Fargo shares are down nearly 3 percent for the year, among the worst performers in the S&P 500's financials sector. The bank paid $185 million in penalties after it was discovered Wells Fargo employees had opened about 2 million consumer deposit and credit card accounts without customers' authorization since 2011. CEO Tim Sloan took over the company in October 2016 and the bank announced a board shakeup this past August.
Last week, Wells Fargo reported a revenue miss in the third quarter. Shares rose 0.6 percent in midday Thursday trading.
In contrast, Citi reported better-than-expected earnings last week and shares are up nearly 22 percent this year as one of the best performers in the S&P financial sector. Shares recovered some of their losses to trade about 0.7 percent lower Thursday afternoon, amid a broad market decline.
Financial stocks overall are up more than 12 percent this year.